A development on lot streaming with supplier-manufacturer coordination

In this paper, we extend Li and Xiao (2004)'s study by relaxing the assumption of the transportation cost between each pair of parties in a supply chain is fixed and independent of shipment size. With the analysis, we find that the supplier's optimal decision with considering near-realistic transportation cost is more differing from that with fixed transportation cost. Accordingly, the coordination mechanism between the supplier and the manufacturer is changed to be more complex.