The Integrated Size and Price Optimization problem

Titelangaben

Kießling, Miriam ; Kurz, Sascha ; Rambau, Jörg:
The Integrated Size and Price Optimization problem.
Bayreuth , 2012

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Abstract

We present the Integrated Size and Price Optimization Problem (ISPO) for a fashion discounter with many branches. Based on a two-stage stochastic programming model with recourse, we develop an exact algorithm and a production-compliant heuristic that produces small optimality gaps. In a field study we show that a distribution of supply over branches and sizes based on ISPO solutions is significantly better than a one-stage optimization of the distribution ignoring the possibility of optimal pricing.