An acquisition policy for a multi-supplier system with a finite-time horizon
We study the problem of a manufacturer who outsources a single product to multiple capacitated suppliers. Given a pool of potential suppliers, a decision has to be made about which supplier(s) to use, and how much and how often to purchase from each selected supplier. We build an EOQ-type model with a finite-time horizon, which differs from the existing model in the literature with an infinite-time horizon. We design a dynamic programming and a scatter search algorithm to solve the problem, and provide computational results to show the effectiveness of the proposed methods.
finite-time horizon dynamic programming scatter search multiple suppliers capacity