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Supplier Costs 1 2 3 4 5 6 7 8 input cells Supplier Bids 1 2 3 4 5 6 7 8

Execution 0 10 20 30 50 65 80 100

Reservation 42 33 25 19 10 5 2 0

Final price Uniform demand Lower bound Upper bound

100 0 100

UPDATE ORDERS OPTIMIZE BID for


Supplier # 1

Execution 12 14 21 31 64 66 72 100

Reservation 32.71428571 31 25 19 6.73 7 4.85 0

Position 1 2 3 4 5 6 7 8

Status ACTIVE ACTIVE ACTIVE ACTIVE ACTIVE INACTIVE ACTIVE ACTIVE

Quantity 14.32855001 14.29795743 40.0059994 62.81930851 76.50293713 76.50293713 82.67919003 100

Profit 26.57333788 -0.04366998 18.72779996 11.08438144 13.37496435 0 7.518260541 0

7 6 5 Supplier 4 3 2 1 -10 0 10 Profit 20 30

x x x x x x

INSTRUCTIONS TO USE THE SPREADSHEET This file simulates the interaction between suppliers that compete for the procurement of a manufacturer. The given data is the following: there are N=7 suppliers the final selling price is p=100 the costs of reserving capacity and producing are given by cells B3-C9 the customer demand follows a uniform distribution in [0;100], presented in cells E2-F4

The input from the suppliers are in the form of a pair of a reservation fee and an execution fee. For instance, if supplier 2 offers These inputs are coloured in red and are presented in cells B16-C22

Once the inputs are introduced, you must hit the button "UPDATE ORDERS" in order to obtain the decision of the manufacture the position is the rank in which the manufacturer calls the suppliers when it requests (exec the status is the description of the competitive position of the suppliers, inactive meaning th the quantity is the cumulated amount of capacity bought from a particular supplier plus all th finally, the profit is the expected profit obtained by a supplier given all these bids, they are p

One can optimize the profit of a given supplier either by doing it by hand (inputting new bids and hitting "UPDATE ORDERS"), o

00], presented in cells E2-F4

. For instance, if supplier 2 offers a reservation price v=5 and an execution price w=80, then the manufacturer will pay 5 for every unit of capa

n the decision of the manufacturer. This information is shown in the columns next to the bids, and consist of suppliers when it requests (executes) supply; for example if the position is 3, then two other suppliers are called before this particular suppli he suppliers, inactive meaning that the supplier gets zero orders from the manufacturer, and active meaning some order (can be very small t om a particular supplier plus all the suppliers with smaller position, therefore the "real" capacity reserved is given by the difference of the qua er given all these bids, they are plotted in the graph of the spreadsheet

d hitting "UPDATE ORDERS"), or otherwise by hitting "OPTIMIZE BID" after filling the cell F11 with the correct number; this last function retu

er will pay 5 for every unit of capacity it reserves and 80 for every unit of supply it requests.

alled before this particular supplier g some order (can be very small though) given by the difference of the quantity shown in the cell of a supplier minus the quantity shown in the cell of the supplier with previous position

ect number; this last function returns an approximation of the optimal bid that can be improved by hand

he supplier with previous position

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