• 산업경영시스템학회지
• /
• 제43권1호
• /
• pp.70-78
• /
• 2020

Under the situation which customer orders are cancelled unless all products in the order are delivered all at once, this paper concentrates on the purchase dependent demands and explores the systematic approach to implant the purchase dependence into the multi-product inventory model. First, by acknowledging that it is a challenging task to formulate a suitable inventory model for the purchase dependence, we derive the optimal solution condition using an EOQ model and extend the optimal solution condition to periodic review models. Then, through the comparison simulation of four inventory policies regarding several degrees of purchase dependence, we demonstrate that the inventory models which consider the purchase dependence generate less total cost than the inventory models which ignore the purchase dependence. In general, the inventory models which consider the purchase dependence reduce the loss of sales by maintaining more inventories, which results in reducing the total cost. Consequently, the simulation result supports the effectiveness of this paper's approach. In addition, this paper uses the individual order period and joint order period obtained from the EOQ model for the multi-product inventory model. Through the in-depth analysis of comparing the two models, we observe that the model of using the joint order period produces less total cost when the degree of purchase dependence is high, but the model of using the individual order period produces less total cost when the degree of purchase dependence is low.

• 경영과학
• /
• 제32권1호
• /
• pp.65-82
• /
• 2015

Purchase dependence is a frequent phenomenon in retail shops and is characterized by the purchase of certain items together due to their unknown interior associations. Although this concept has been significantly examined in the marketing field (e.g. market basket analysis), it has largely remained unaddressed in operations management. Since purchase dependence is an important factor in designing inventory replenishment policies, this paper demonstrates the means of applying it to the partial backordering inventory model. Through computational analyses, this paper compares the performance of inventory models that either consider or ignore purchase dependence; the results demonstrate that inventory models that ignore purchase dependence incur more average cost per unit time than the model that considers purchase dependence, and the impact of purchase dependence can increase in significance as the item set becomes more closely correlated with regard to order demand.

• Industrial Engineering and Management Systems
• /
• 제14권3호
• /
• pp.275-288
• /
• 2015

Purchase dependence is a frequent phenomenon in retail shops and is characterized by the purchase of certain items together due to their unknown interior associations. Although this concept has been significantly examined in the marketing field (e.g. market basket analysis), it has largely remained unaddressed in operations management. Since purchase dependence is an important factor in designing inventory replenishment policies, this paper demonstrates the means of applying it to the partial backordering inventory model. Through computational analyses, this paper compares the performance of inventory models that either consider or ignore purchase dependence; the results demonstrate that inventory models that ignore purchase dependence incur more average cost per unit time than the model that considers purchase dependence, and the impact of purchase dependence can increase in significance as the item set becomes more closely correlated with regard to order demand.

• 산업경영시스템학회지
• /
• 제38권4호
• /
• pp.98-108
• /
• 2015

This paper introduces the existence of purchase dependence that was identified during the analysis of inventory operations practice at a sales agency of dealing with spare parts for ship engines and generators. Purchase dependence is an important factor in designing an inventory replenishment policy. However, it has remained mostly unaddressed. Purchase dependence is different from demand dependence. Purchase dependence deals with the purchase behavior of customers, whereas demand dependence deals with the relationship between item-demands. In order to deal with purchase dependence in inventory operations practice, this paper proposes (Q, r) models with the consideration of purchase dependence. Through a computer simulation experiment, this paper compares performance of the proposed (Q, r) models to that of a (Q, r) model ignoring purchase dependence. The simulation experiment is conducted for two cases : a case of using a lost sale cost and a case of using a service level. For a case of using a lost sale cost, this paper calculates an order quantity, Q and a reorder point, r using the iterative procedure. However, for a case of using a service level, it is not an easy task to find Q and r. The complexity stems from the interactions among inventory replenishment policies for items. Thus, this paper considers the genetic algorithm (GA) as an optimization method. The simulation results demonstrates that the proposed (Q, r) models incur less inventory operations cost (satisfies better service levels) than a (Q, r) model ignoring purchase dependence. As a result, the simulation results supports that it is important to consider purchase dependence in the inventory operations practice.

• 한국경영과학회지
• /
• 제39권1호
• /
• pp.83-100
• /
• 2014

Retail shops often experience purchase dependence in which some items are purchased together by customers due to their unknown interior associations. This paper develops an inventory model considering partial backordering under purchase dependence and compares the performance of the inventory model that ignores purchase dependence. Computational analyses show that purchase dependence should be incorporated as an important factor of inventory replenishment policy because the impact of purchase dependence can be more significant as the lost portion of the unmet demand orders increases and the item set is more correlated in terms of order demand.

• 경영과학
• /
• 제33권1호
• /
• pp.1-16
• /
• 2016

Drop-shipping is a commonly adopted online-order fulfillment strategy in the Internet age. In this practice, online retailers leverage the fulfillment capabilities of suppliers to fulfill orders. On the other hand, purchase dependence is a frequent phenomenon and is characterized by the purchase of certain items together due to their unknown interior associations. Although this concept has been significantly examined in the marketing field (e.g. market basket analysis), it has largely remained unaddressed in operations management. This paper develops an (R, T) model to address an environment in which unmet demand orders are partially lost and partially backordered when purchase dependence exists. The partial backorders are fulfilled by a drop-shipping option. Through computational analyses, this paper demonstrates the effect of both drop shipping on a partial backordering and purchase dependence. The results shows that more profit can be realized by utilizing a drop-shipping option under purchase dependence.

• 산업경영시스템학회지
• /
• 제40권4호
• /
• pp.137-146
• /
• 2017

For the competitive business environment under purchase dependence, this paper proposes a new approximate calculation of order fill rate which is a probability of satisfying a customer order immediately using the existing inventory. Purchase dependence is different to demand dependence. Purchase dependence treats the purchase behavior of customers, while demand dependence considers demand correlation between items, between regions, or over time. Purchase dependence can be observed in such areas as marketing, manufacturing systems, and distribution systems. Traditional computational methods have a difficulty of the curse of dimensionality for the large cases, when deriving the stationary joint distribution which is utilized to calculate the order fill rate. In order to escape the curse of dimensionality and protect the solution from diverging for the large cases, we develop a greedy iterative search algorithm based on the Gauss-Seidel method. We show that the greedy iterative search algorithm is a dependable algorithm to derive the stationary joint distribution of on-hand inventories in the retailer system by conducting a comparison analysis of a greedy iterative search algorithm with the simulation. In addition, we present some managerial insights such as : (1) The upper bound of order fill rate can be calculated by the one-item pure system, while the lower bound can be provided by the pure system that consists of all items; (2) As the degree of purchase dependence declines while other conditions remain same, it is observed that the difference between the lower and upper bounds reduces, the order fill rate increases, and the order fill rate gets closer to the upper bound.

• 경영과학
• /
• 제30권3호
• /
• pp.17-31
• /
• 2013

The purpose of this paper is to illustrate the importance of identifying and considering 'purchase dependence' when purchase of an item is dependent on availability of other items demanded in the same order. This paper is the first study to develop an inventory model for purchase-dependent inventory systems. Through simulation experiments, we demonstrate that the developed inventory model incurs less inventory operations cost than other inventory models that ignore purchase dependence. For empirical validation of the developed inventory model, the actual inventory data at the Hyundai Engine Europe Service Center is used. We explain the process of identifying purchase dependencies among items through a data mining technique. The empirical study results in similar results to the simulation experiment, demonstrating that the developed inventory model is applicable to real situations.

• 한국경영과학회지
• /
• 제41권2호
• /
• pp.35-51
• /
• 2016

This paper proposes a new approximate approach to calculate the order fill rate and the probability of filling an entire customer order immediately from the shelf in a business environment under purchase dependence characterized by customer purchase patterns observed in such areas as marketing, manufacturing systems, and distribution systems. The new approximate approach divides customer orders into item orders and calculates fill rates of all order types to approximate the order fill rate. We develop a greed iterative search algorithm (GISA) based on the Gauss-Seidel method to avoid dimensionality and prevent the solution divergence for larger instances. Through the computational analysis that compares the GISA with the simulation, we demonstrate that the GISA is a dependable algorithm for deriving the stationary joint distribution of on-hand inventories in the type-K pure system. We also present some managerial insights.

• 한국의류산업학회지
• /
• 제24권3호
• /
• pp.303-314
• /
• 2022

This study examined the impact of the social features (identification, interaction, information value) and technical features (visibility affordance, metavoicing affordance, social connecting affordance) in live commerce on consumers' attachment, which in turn affects consumers' continued intent to watch live commerce and intent to purchase from the platform. Consumers' attachment was represented by emotional attachment to the live shopping streamer and functional dependence on live commerce. Furthermore, this study investigated the effect of attachment on continuous watching intention and purchase intention. Using a web-based survey and consumers in their 20s and 30s (average age: 30.32) as a sample, this study collected 274 usable responses. The results showed that among the live commerce social system constructs, identification and interaction positively affected emotional attachment to the live commerce streamer. Among the live commerce technical system constructs, visibility affordance and social connecting affordance positively influenced functional dependence on live commerce. Both emotional attachment to the live streamer and functional dependence on live commerce were positively related to a continued intent to watch, which influenced the intent to purchase. This study empirically investigated live commerce based on the socio-technical systems framework and confirmed that both social and technical factors have a significant effect on consumers. This study also identified the impact of live commerce on consumers' attitudes through attachment theory. In addition, it has proved the antecedents and effect of continuous watching of live commerce on purchase behavior by focusing on continuous watching intention where less attention was paid in live commerce research.