A vendor‐buyer integrated production‐inventory model with quantity discount and unequal sized shipments

This paper considers a single‐vendor single‐buyer integrated production‐inventory model for a single product. The vendor offers a quantity discount to motivate the buyer to buy more quantities and he delivers the buyer's order quantity in a number of unequal sized shipments. The proposed model is formulated and the optimal decisions are obtained by minimising the average total cost of the integrated system. A numerical example is taken to illustrate the developed model.