Optimal Pricing Strategy for Local Distribution Centers

This paper presents a new model to determine selling price, carrying cost and batch size of multi items in a supply chain, simultaneously. The supply chain includes a wholesaler and a set of independent local distribution centers positioned around the wholesaler, geographically and the primary objective is to maximize the total profit of the wholesaler. The proposed model of this paper is formulated as a genera concave quadratic function subject to some linear constraints. This type of problem is classified as a reverse convex program where the optimal solution lies on extreme points. S greedy heuristic algorithm is proposed to locate the near optimal solutions and the results are compared with an efficient upper bound. The proposed method of this paper is also applied for a real world case study.