ABSTRACT

We consider a multi-period capacity reservation contract practiced between a buyer and multiple suppliers, where the buyer buys multiple types of product and sells it to end-customers, and the suppliers produces and replenishes the products as agreed upon contractually. In this paper, we developed mathematical model to detemine the optimal capacity reservation limits on a rolling-horizon basis. We use sampling average approximation method Numerical experiments based on a test problem motivated from apparel industry are provided.