Abstract

This paper develops and compares two mathematical models for describing situation in coordination of buyer and vendor. In this case the vendor which is an Original Equipment Manufacturers (OEMS) of automotive parts, are supplying different type of buyers, i.e. automotive industry, repair shop and automotive dealers. It is well known that automotive industries are operated in Just in Time (JIT) Production Environment, so that the demand behaviour from this buyer has different characteristics than the demand behaviour from other buyers. Two mathematical models are developed in order to depict two different manufacturing strategies as the vendor response dealing with different type of buyers. These strategies are dividing production lot size for each type of buyer and consolidating all buyer’s demand in to single production lot size.

Highlights

  • Introduction and Literature ReviewNowadays, a company needs to perform activities in their business processes efficiently

  • For 2nd type of buyer, which are not operating in Just in Time (JIT) environment, the vendor is free to decide the value of Q2

  • Concluding Remarks The research presented here are mainly about the buyer vendor coordination for an Original Equipment Manufacturer (OEM) manufacturer that support the component to 2 types of buyers which are: 1) automotive manufacturer and 2) repair shop and dealer

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Summary

A A Habib and R Govindaraju

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