| Article ID: | iaor19941484 |
| Country: | United States |
| Volume: | 24 |
| Issue: | 1 |
| Start Page Number: | 50 |
| End Page Number: | 63 |
| Publication Date: | Jan 1994 |
| Journal: | Interfaces |
| Authors: | Katz Paul, Sadrian Amir, Tendrick Patrick |
| Keywords: | decision, programming: integer |
Increasingly, organizations that buy many products from several suppliers solicit discounts based on the total dollar volume of business awarded. Bellcore developed PDSS, a user-friendly, PC-based decision support program that assists telephone companies in analyzing price quotations under business volume discounts. PDSS uses a mixed-integer-programming model to minimize the total cost of purchases subject to several types of constraints and may save an organization five to 15 percent on purchase costs. Since its initial release, PDSS has been applied successfully to categories of products with a total purchase cost of more than $600 million.