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Purchasing Costs (purchasing + cost)

Distribution by Scientific Domains

Business, Economics, Finance and Accounting	75%

Selected Abstracts

A study of economic evaluation of demand-side energy storage system in consideration of market clearing price

ELECTRICAL ENGINEERING IN JAPAN, Issue 1 2007
Ken Furusawa
Abstract In Japan the electricity market will open on April 1, 2004. Electric utility, Power Producer and Supplier (PPS), and Load Service Entity (LSE) will join the electricity market. LSEs purchase electricity based on the Market Clearing Price (:MCP) from the electricity market. LSEs supply electricity to the customers that contracted with the LSEs on a certain electricity price, and one to the customers that introduced Energy Storage System (:ES) on a time-of-use pricing. It is difficult for LSEs to estimate whether they have any incentive to promote customers to introduce ES or not. This paper evaluates the reduction of LSEs' purchasing cost from the electricity market and other LSEs' purchasing cost by introducing ES to customers. It is clarified which kind of customers has the effect of decreasing LSEs' purchasing cost and how much MCP of the whole power system the demand-side energy storage systems change. Through numerical examples, this paper evaluates the possibility of giving the cost merit to both customers with energy storage systems and LSE by using real data for a year's worth of MCP. © 2006 Wiley Periodicals, Inc. Electr Eng Jpn, 158(1): 22,35, 2007; Published online in Wiley InterScience (www.interscience.wiley.com). DOI 10.1002/eej.20447 [source]

The Impact of E-Replenishment Strategy on Make-to-Order Supply Chain Performance

DECISION SCIENCES, Issue 1 2005
E. Powell Robinson Jr.
ABSTRACT This research investigates the impact of electronic replenishment strategy on the operational activities and performance of a two-stage make-to-order supply chain. We develop simulation-based rolling schedule procedures that link the replenishment processes of the channel members and apply them in an experimental analysis to study manual, semi-automated, and fully automated e-replenishment strategies in decentralized and coordinated decision-making supply chain structures. The average operational cost reductions for moving from a manual-based system to a fully automated system are 19.6, 29.5, and 12.5%, respectively, for traditional decentralized, decentralized with information sharing, and coordinated supply chain structures. The savings are neither equally distributed among participants, nor consistent across supply chain structures. As expected, for the fully coordinated system, total costs monotonically decrease with higher levels of automation. However, for the two decentralized structures, under which most firms operate today, counter-intuitive findings reveal that the unilateral application of e-procurement technology by the buyer may lower his purchasing costs, but increase the seller's and system's costs. The exact nature of the relationship is determined by the channel's operational flexibility. Broader results indicate that while the potential economic benefit of e-replenishment in a decentralized system is substantial, greater operational improvements maybe possible through supply chain coordination. [source]

A Framework for Facilitating Sourcing and Allocation Decisions for Make-to-Order Items

DECISION SCIENCES, Issue 4 2004
Nagesh N. Murthy
ABSTRACT This paper provides a fundamental building block to facilitate sourcing and allocation decisions for make-to-order items. We specifically address the buyer's vendor selection problem for make-to-order items where the goal is to minimize sourcing and purchasing costs in the presence of fixed costs, shared capacity constraints, and volume-based discounts for bundles of items. The potential suppliers for make-to-order items provide quotes in the form of single sealed bids or participate in a dynamic auction involving open bids. A solution to our problem can be used to determine winning bids amongst the single sealed bids or winners at each stage of a dynamic auction. Due to the computational complexity of this problem, we develop a heuristic procedure based on Lagrangian relaxation technique to solve the problem. The computational results show that the procedure is effective under a variety of scenarios. The average gap across 2,250 problem instances is 4.65%. [source]

Buying in a Businesslike Fashion, And Paying More?

PUBLIC ADMINISTRATION REVIEW, Issue 5 2000
Joseph Besselman
The government, particularly the Department of Defense (DoD), is undergoing yet another wave of acquisition reforms, which are intended to bring commercial buying practices to DoD's purchasing operations. This research shows that, prior to these reforms, the DoD's buying practices were superior to commercial practices in terms of prices paid for a large number of electronic and engine parts. The research compares DoD and purchasing of more than 676,000 identical items costing more than $60 million with commercial purchasing of the identical items. It finds that the DoD's purchasing superiority holds even when purchasing costs are considered. The DoD achieved these results because it was already using commercial practices commonly followed by large firms: aggregating purchases, using cost data, and negotiating aggressively in markets with few suppliers. Some of the recent reforms will undermine the DoD's ability to exploit these common commercial practices and will raise the government's costs. [source]