Adaptive fuzzy approach to estimate supplier's competitiveness in open e-bidding

Abstract

This paper presents an adaptive fuzzy approach to estimate the competition of the suppliers in an open electronic bidding. The competition is formulated as the supply curve relating pricing against requested quantity. A set of supply curves, each from a competitor, is formulated into fuzzy expression to allow flexibility for a supplier to prepare an optimal pricing policy that deals with the fact that other competitors are also adapting at some unknown rate. The pricing policy is formulated into a mathematical expression that is easily adjusted as new information on the competitors becomes available. A revision of pricing policy for a supplier to compete on the pricing basis while maintaining an optimal profit margin is derived as an application. Computer simulations are provided to demonstrate the workability of this approach