Incorporating transport cost in the lot size and pricing decisions with downward sloping demand

There is an increased emphasis in supply chain management on making all costs transparent. This has led to greater scrutiny of freight costs by the resellers who want to control their inbound logistics costs. An astute reseller may opt for paying freight when he sees an opportunity for savings. In some cases, a supplier may only sell on conditions of FOB origin. In this paper, we consider a reselling situation wherein the final demand is …