Article ID: | iaor201525884 |
Volume: | 22 |
Issue: | 3 |
Start Page Number: | 310 |
End Page Number: | 341 |
Publication Date: | Mar 2015 |
Journal: | International Journal of Operational Research |
Authors: | Rabbani Masoud, Keyhanian Sina |
Keywords: | production, financial, programming: mathematical, optimization |
Nowadays, leasing is turning into a growing alternative to satisfy needs of durable products. This paper aims to analyse the inflation‐brought competition between sales and leasing, by designing a bi‐objective mathematical model. Two sets of price and inflation‐sensitive joint demand functions are introduced for customers' purchasing and leasing demand. Purchase rebates or bargaining on leased product's initial value are employed on manufacturer's suggested retail price (MSRP), to attract customer's view on both purchasing price and monthly lease payments respectively. Two models are defined; one for pricing and inventory decisions, another for lease‐contracts' assignment plan. The objectives are to maximise revenue and whole lease turn‐overs. The MINLP model's objectives are gathered into one by using Minkowsky distance‐based L