Coordinated Lot-sizing and Dynamic Prizing under a Supplier All-units Quantity Discount

We consider an economic order quantity model where the supplier offers an all-units quantity discount and a price sensitive customer demand. We compare a decentralized decision framework where selling price and replenishment policy are determined independently to simultaneous decision making. Constant and dynamic pricing are distinguished. We derive structural properties and develop algorithms that determine the optimal pricing and replenishment policy and show how quantity discounts not only influence the purchasing strategy but also the pricing policy. A sensitivity analysis indicates the impact of the fixed-holding cost ratio, the discount policy, and the customers' price sensitivity on the optimal decisions.

Competing manufacturers in a retail supply chain: On contractual form and coordination

It is common for a retailer to sell products from competing manufacturers. How then should the firms manage their contract negotiations? The supply chain coordination literature focuses either on a single manufacturer selling to a single retailer or one manufacturer selling to many (possibly competing) retailers. We find that some key conclusions from those market structures do not apply in our setting, where multiple manufacturers sell through a single retailer. We allow the manufacturers to compete for the retailer's business using one of three types of contracts: a wholesale-price contract, a quantity-discount contract, or a two-part tariff. It is well known that the latter two, more sophisticated contracts enable the manufacturer to coordinate the supply chain, thereby maximizing the profits available to the firms. More importantly, they allow the manufacturer to extract rents from the retailer, in theory allowing the manufacturer to leave the retailer with only her reservation profit. However, we show that in our market structure these two sophisticated contracts force the manufacturers to compete more aggressively relative to when they only offer wholesale-price contracts, and this may leave them worse off and the retailer substantially better off. In other words, although in a serial supply chain a retailer may have just cause to fear quantity discounts and two-part tariffs, a retailer may actually prefer those contracts when offered by competing manufacturers. We conclude that the properties a contractual form exhibits in a one-manufacturer supply chain may not carry over to the realistic setting in which multiple manufacturers must compete to sell their goods through the same retailer. © 2010 INFORMS.

Revisiting the determinants of unit values

This paper studies the issue of how traded quantities affect trade prices, which has been relatively unexplored in the trade literature. By reproducing previous literatures' regressions which are based on the general equilibrium trade theories, incorporating the role of traded quantities, this paper shows a possibility of prevalence of the second degree price discrimination (quantity discount) in international trade, rather than the pricing behaviour of the general equilibrium theories.

Optimal auctions for multi-unit procurement with volume discount bids

Our attention, is focused on designing an optimal procurement mechanism which a buyer can use for procuring multiple units of a homogeneous item based on bids submitted by autonomous, rational, and intelligent suppliers. We design elegant optimal procurement mechanisms for two different situations. In the first situation, each supplier specifies the maximum quantity that can be supplied together with a per unit price. For this situation, we design an optimal mechanism S-OPT (Optimal with Simple bids). In the more generalized case, each supplier specifies discounts based on the volume of supply. In this case, we design an optimal mechanism VD-OPT (Optimal with Volume Discount, bids). The VD-OPT mechanism uses the S-OPT mechanism as a building block. The proposed mechanisms minimize the cost to the buyer, satisfying at the same time, (a) Bayesian, incentive compatibility and (b) interim individual rationality.

Discount rates in disarray : evidence on flawed goodwill impairment testing

Carlin and Finch, this issue, compare goodwill impairment discount rates used by a sample of large Australian firms with ‘independently’ generated discount rates. Their objective is to empirically determine whether managers opportunistically select goodwill discount rates subsequent to the 2005 introduction of International Financial Reporting Standards (IFRS) in Australia. This is a worthwhile objective given that IFRS introduced an impairment regime, and within this regime, discount rate selection plays a key role in goodwill valuation decisions. It is also timely to consider the goodwill valuation issue. Following the recent downturn in the economy, there is a high probability that many firms will be forced to write down impaired goodwill arising from boom period acquisitions. Hence, evidence of bias in rate selection is likely to be of major concern to investors, policymakers and corporate regulators. Carlin and Finch claim their findings provide evidence of such bias. In this commentary I review the validity of their claims.

Implicit discount rates and fisheries management : is there a relationship?

Fishers are faced with multiple risks, including unpredictability of future catch rates, prices and costs. While the latter are largely beyond the control of fisheries managers, effective fisheries management should reduce uncertainty about future catches. Different management instruments are likely to have different impacts on the risk perception of fishers, and this should manifest itself in their implicit discount rate. Assuming licence and quota values represent the net present value of the flow of expected future profits, then a proxy for the implicit discount rate of vessels in a fishery can be derived by the ratio of the average level of profits to the average licence/quota value. From this, an indication of the risk perception can be derived, assuming higher discount rates reflect higher levels of systematic risk. In this paper, we apply the capital asset pricing model (CAPM) to determine the risk premium implicit in the discount rates for a range of Australian fisheries, and compare this with the set of management instruments in place. We test the assumption that rights based management instruments lower perceptions of risk in fisheries. We find little evidence to support this assumption. although the analysis was based on only limited data.

Value management : an extension of quantity surveying services in Malaysia

Value Management (VM) initially started in early 1940s in the US manufacturing industry has increasingly becoming popular within the construction industry community internationally. It has been widely accepted as an important tool in the management of projects. The structured, systematic and multi-disciplinary approach in decision making process is a niche for VM in delivering better value for money project to the client investment. It would appear to be gaining some momentum as an essential management tool in the Malaysian construction sector especially in the quantity surveying practice. Quantity surveyors increasing involvement in VM provides an opportunity for the profession to re-model some of its traditional services in a more positive light and develop leading-edge skills and promote the profession. International practice has associated VM to be part of services offered in the quantity surveying practice; especially in UK has proven to be a natural progression of QS profession. The introduction of VM as early 1980’s in Malaysia combined with increasing demand for construction project to facilitate nation progress is shedding a positive light for quantity surveying profession to take lead in developing VM as one of their niche area. Therefore, the quantity surveying profession having the opportunity to take lead of this service which reflect their traditional attributes for providing the best value-for-money advise to the client. This paper shall discuss on the development of VM in Malaysia and the challenges VM face services in QS firm to remain ahead of their competitors.

The learning climate of chartered quantity surveying practices

This paper reports on a fully structured interview survey investigating the relationship between the learning climate of chartered quantity surveying practices and individual learning styles, approaches to learning, ability, measures of length of service and the size of the quantity surveying organisation. The results indicate that the learning environment is generally supportive in terms of human support, but less supportive in terms of staff development systems; as individuals rise in the hierarchy of an organisation, their perception of its ability to provide an appropriate learning environment increases. Likewise, perceptions of human support and working practices within organisations increase significantly with length of time in the profession; larger organisations have more advanced staff development systems but provide less human support; and the learning environment both overall and in terms of working practices correlates positively with learning styles and approaches to learning.

Quantity of documentation of maltreatment risk factors in injury-related paediatric hospitalisations

Background While child maltreatment is recognised as a global problem, solid epidemiological data on the prevalence of child maltreatment and risk factors associated with child maltreatment is lacking in Australia and internationally. There have been recent calls for action to improve the evidence-base capturing and describing child abuse, particularly those data captured within the health sector. This paper describes the quantity of documentation of maltreatment risk factors in injury-related paediatric hospitalisations in Queensland, Australia. Methods This study involved a retrospective medical record review, text extraction and coding methodology to assess the quantity of documentation of risk factors and the subsequent utility of data in hospital records for describing child maltreatment and data linkage to Child Protection Service (CPS). Results There were 433 children in the maltreatment group and 462 in the unintentional injury group for whom medical records could be reviewed. Almost 93% of the any maltreatment code sample, but only 11% of the unintentional injury sample had documentation identified indicating the presence of any of 20 risk factors. In the maltreatment group the most commonly documented risk factor was history of abuse (41%). In those with an unintentional injury, the most commonly documented risk factor was alcohol abuse of the child or family (3%). More than 93% of the maltreatment sample also linked to a child protection record. Of concern are the 16% of those children who linked to child protection who did not have documented risk factors in the medical record. Conclusion Given the importance of the medical record as a source of information about children presenting to hospital for treatment and as a potential source of evidence for legal action the lack of documentation is of concern. The details surrounding the injury admission and consideration of any maltreatment related risk factors, both identifying their presence and ruling them out are required for each and every case. This highlights the need for additional training for clinicians to understand the importance of their documentation in child injury cases.

Continuous positive air pressure treatment for obstructive sleep apnoea patients : effects on sleep quality and quantity as measured by actigraphy

Objectives Actigraphy can reliably assess sleep in healthy adults and be used to estimate total sleep time in suspected obstructive sleep apnoea (OSA) patients. We compared sleep quality for Continuous Positive Air Pressure (CPAP) treated OSA patients and controls, evaluating the impact of stopping CPAP for one night. Methods 11 men, aged 51–75 years (m = 65.6 years), compliant CPAP users, treated for 1–19 years (m = 7.8 years) wore Cambridge Neurotechnology Ltd actiwatches for one night while using CPAP and for one night sleeping without CPAP. A control group of 11 healthy men, aged 63–74 years (m = 64.1 years) slept normally whilst wearing an actiwatch. Subsequent daytime sleepiness was recorded using Karolinska sleepiness scores (KSS). Results Actimetry showed no significant differences between actual sleep time, sleep efficiency, sleep disturbance index or number of wake bouts when comparing OSA participants using CPAP, with controls; there was no difference in subsequent daytime sleepiness, control KSS = 4.21, OSA KSS = 4.17. Without CPAP there was no significant difference in sleep length or sleep onset latency compared with using CPAP, but there was a significant impact on sleep quality as shown by: increased sleep disturbance index from 7.9 to 13.8 [t(10) = 3.510, P < 0.05], decreased percent of actual sleep from 92.05% to 86.15% [t(10) = 3.51, P < 0.05], decreased sleep efficiency from 86.6% to 81% [t(10) = 2.204, P < 0.05] and increased number of wake bouts from 29 to 42.5 [t(10) = 3.877, P < 0.05]. Daytime sleepiness became significantly worse increasing from KSS 4.17 to 6.27 [t(10) = )4.96, P < 0.05]. Conclusion There was no disparity in sleep quality or KSS scores between CPAP treated OSA patients and healthy controls of a similar age. Treated OSA patients obtained quality sleep with no elevated day time sleepiness. However, cessation of treatment for one night caused sleep quality to deteriorate despite a comparable sleep time; the deterioration in sleep quality could explain the increase in daytime sleepiness. OSA patients need to know that even short-term noncompliance with CPAP treatment significantly impairs sleep quality, leading to excessive sleepiness during monotonous tasks such as driving. Actigraphy successfully identified nights of non-compliance in treated OSA patients; but did not differentiate between the sleep of CPAP treated OSA patients and healthy controls.