Article ID: | iaor200971638 |
Country: | United States |
Volume: | 57 |
Issue: | 5 |
Start Page Number: | 1206 |
End Page Number: | 1219 |
Publication Date: | Sep 2009 |
Journal: | Operations Research |
Authors: | Savin Sergei, Muharremoglu Alp, elik Sabri |
Keywords: | inventory |
We consider a novel variant of the perishable inventory profit management problem faced by a firm that sells a fixed inventory over a finite horizon in the presence of price-adjustment costs. In economics literature, such price-adjustment costs are widely studied and are typically assumed to include a fixed component (e.g., advertising costs), an inventory-dependent component (e.g., inventory relabeling costs), as well as a component that depends on the magnitude of the price adjustment (e.g., cognitive and coordination managerial costs).