Fashion Retailing Inventory Management with Random Supply
We consider a fashion retailing inventory problem in this chapter. We focus on exploring the scenario in which the fashion retailer, which is modeled as a newsvendor places an order for a fashionable product to the fashion supplier with random supply The retail selling price of a fashionable product is a decreasing function of the supplier's random supply. We further consider two scenarios regarding the product cost: (i) the procurement case, in which the fashion retailer is a pure retailer; and (ii) the in house production case, in which the fashion retailer also manufactures the product by itself. The optimal ordering decisions for both cases are determined and compared. Sensitivity analysis is conducted and insights are revealed.