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Multi-period news vendor model with capacity constraint.

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A retail store stocks fashion clothing for different seasons. Each selling season lasts for 6 weeks and a single procurement order has to be placed with the manufacturer two months before the selling seasons starts. This designer jacket comes in four different colors. It is priced at Rs. 2100. The retailer buys the jacket from the manufacturer at Rs. 1500. Any leftover inventory is sold to a discount store for Rs. 1275 per unit. The demand distribution for the four colors is given as: Black : N(150, 50); Blue : (75, 15); Pink : N(120, 50); Jade : N(100,15). The total shelf space for this brand is 400 units. How many of each color should the retailer procure?

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Multi-period news vendor model with capacity constraints are examined. This posting contains an example on a multiple item news-vendor problem with a shelf space constraint.

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Question: A retail store stocks fashion clothing for different seasons. Each selling season lasts for 6 weeks and a single procurement order has to be placed with the manufacturer two months before the selling seasons starts. This designer jacket comes in four different colors. It is priced at Rs. 2100. The retailer buys the jacket from the manufacturer at Rs. 1500. Any leftover inventory is sold to a discount store for Rs. 1275 per unit. The demand distribution for ...

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