Optimal Order Allocation with Discount Pricing
نویسندگان
چکیده
We consider a problem of optimal order allocation faced for example by an internet trading agent who seeks to ful l an order for speci ed amounts of several products from a pre-arranged list of suppliers, taking into account availability and price. We present a mixed integer programming (MILP) formulation for the case that suppliers impose a xed charge which is waived or discounted on orders above a certain threshold value. This formulation is extended to cases where suppliers operate a discount schedule with multiple price breaks. We show that a modi ed capacitated facility location (CFLP) model is appropriate for the general case and outline a solution approach by Lagrangean relaxation.
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