Supply Management Under the Limitation on Production Rates

Abstract This paper presents a supplier selection problem in the case when production rate of any of the available supplier is less than the demand rate. Every supplier is willing to produce products in a consistent manner through out the demand horizon. The supplier-buyer relationship realizes only if the allocated demand, to a supplier, is enough to set a production rate within the production limits proposed by the respected supplier (minimum production rate is set for economies of scales and maximum production rate is due to the production capacities). A solution approach, accompanied by the numerical illustration is proposed.