Article ID: | iaor1996739 |
Country: | United Kingdom |
Volume: | 15 |
Start Page Number: | 261 |
End Page Number: | 270 |
Publication Date: | Sep 1995 |
Journal: | International Journal of Operations & Production Management |
Authors: | Gupta Omprakash K., Kini Ranjan B. |
Keywords: | production: FMS |
Companies have traditionally relied on taking advantage of price-quantity discount (PQD) on large purchases. With the adoption of just-in-time (JIT) philosophy companies are encouraged to purchase materials in small lots to synchronize production with deliveries. This raised a question whether PDQ is applicable in a JIT purchasing environment. Argues that though seemingly inconsistent, JIT and PQD can coexist. Develops an integrated JIT-PQD model to allow a buyer to decide how much to purchase and how many shipments be placed per order.