Analysis Of Order Policy For Retailer With A Sense Of Regret Under Supply And Demand Uncertainties

The enterprises in supply chain are often confronted with many uncertainties.For example,retailers are confronted with the supply and demand uncertainties.Suppliers are often confronted with the timeliness and accuracy of supply caused by capacity and financial constraints.Consumers often change their behavior because of their own psychological or external environment.Therefore,the supply chain enterprises need to match the uncertainty of upstream with downstream,so that the supply and demand can be balanced.This is particularly important for retailers in the supply chain.In this paper,we study the order strategy of retailers with regretful psychology under the condition of the supply and demand are uncertain.The goal of the retailer is to maximize the expected utility.This paper mainly uses the method of model analysis to combine the classical newsboy model with the theory of regret and the uncertainty theory of supply and demand,and carries on the numerical experiment to the model with the actual data.The numerical experiment uses the Matlab software to analyze the validity of the conclusion and reliability.We obtained the optimal order quantity and analyzed the effect of regret,the price and cost parameters on the optimal order quantity.The study found that when the retailer,with a sense of regret,are more worried about the remaining,the optimal order quantity decreases as the price increases,and the order quantity decreases with the increase of degree of regret.In the situation of more worried about out of stock,the optimal order quantity increases as the price increases,and the order quantity increases with the increase of degree of regret.Finally,after analyzing the impact of supply and demand uncertainty on retailers,This paper studies how to improve the uncertainty of supply.Through the analysis,we found that the introduction of advance payment strategy can improve the supply uncertainty,meanwhile improve the expected utility of retailer and the expected profit of supplier.Moreover,the study shows that when the cost of capital is higher,the retailer will consider reducing the proportion of advance payment.When the unit cost of funds exceeds the critical value,the retailer will not consider the advance payment strategy.The paper has a guiding significance for the retailer's ordering strategy,and the retailer can refer to the conclusion of the paper to obtain greater expectations.