Journal of Korean Institute of Industrial Engineers (대한산업공학회지)

Korean Institute of Industrial Engineers (대한산업공학회)
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Optimal Allocation of Purchase Orders in Dynamic Bidding

동적 전자경매 환경에서의 최적 구매주문 할당

  • Rim, Suk-Chul (Division of Industrial & Information Systems Engineering, Ajou University) ;
  • Lee, Sang-Won (Division of Industrial & Information Systems Engineering, Ajou University) ;
  • Kim, Hyun-Soo (Major of Industrial Engineering, Kyonggi University)
  • 임석철 (아주대학교 산업정보시스템공학부) ;
  • 이상원 (아주대학교 산업정보시스템공학부) ;
  • 김현수 (경기대학교 산업공학 전공)
  • Published : 2007.09.30
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Abstract

Highly standardized products are suitable for automated purchasing using electronic commerce technology, where the price becomes the most important factor. Suppliers can change the prices dynamically based on the inventory level and market situation in order to maximize the sales and profit. In the virtual marketplace where multiple customers purchase multiple standardized products from multiple suppliers repetitively, customers can purchase the required amount of each item as a dynamic bidding by allocating purchase orders to the suppliers based on the current price. Customers need a method to quickly determine the optimal allocation of orders to the suppliers using the dynamically changing data to minimize the total cost. We present a LP model which minimizes the sum of the total price plus transportation cost for this problem. Simulation results using random data show meaningful reduction of the total cost.

Keywords

References

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