Inbound planning covers all mid-term problems related to supplier interaction,
which concerns supplier order management and master inbound route planning.
Supplier order management determines order rules, i.e., order quantity planning
to define the economic order sizes. It plans dispatching rules for fixed order periods
(r; S-policy) or fixed order quantities (s; q-policy) (Tempelmeier 2008). Retailers
need to determine optimal order quantities with respect to quantity discounts, timevarying
prices (e.g., for promotions), trade terms (e.g., minimum order quantities,
delivery costs) and limited storage capacity. Hence the supplier order management
also determines the inventory levels and safety stocks. It forces a trade-off decision
between the risk of stock outs, obsolete products, high inventory holding costs
and dealing with limited storage and shelf space (Ganeshan 1999; Helnerus 2009).
Zhao et al. (2004) study a modified economic order quantity problem for a single
supplier-retailer system with production, inventory and transportation costs.
Master inbound route planning falls only into the retailers planning domain,
if the retailer coordinates the inbound logistics. This planning step aggregates
supply points to macro- and micro delivery regions. It coordinates the convergent
product flows from suppliers to the retailer, e.g., organization and coordination of
producer deliveries or retailer pick upswith milk runs. The objective is the allocation
of supplier factories to pick up regions to realize bundling effects. Additionally,
master route schedules are determined by region, to realize effects of transportation
bundling under constraints like transportation capacity or lead times.