An operational ordering problem with cooperative retailers and multiple suppliers

We investigate in this paper a cooperative schema for the ordering problem in a two-level Supply Chain involving two suppliers and multiple retailers. Each supplier aims to maximize its product sales by offering attractive quantity discounts; and conversely, the retailers aim to minimize their supply costs through coalition's formation in order to benefit from these discounts. To tackle this ordering problem, we propose a game theory-based model and a solution approach that leads to an equilibrium state in the cooperation process by forming coalitions. The exact method proposed to solve the problem provides stable coalitions of retailers helping them minimizing their supply costs. An illustrative example and preliminary experiments are provided to show the applicability and usefulness of the approach.