Demand relaxation in supplier selection processes

Abstract

Supplier selection processes generally evaluate several criteria in order to fulfill a demand. But, what if the demand itself could be rethought, spreading the possibilities of acquisition? What are the impacts in cost and utility of buying objectives instead of pre-determined materials? This work tries to expand this discussion with a mathematical programming approach to selecting suppliers with demand relaxation. The requirements for the framework development and application in purchasing departments are also pointed out. Its adoption in association with combinatorial auctions concepts in a hypothetical but realistic context suggests a high potential to cost reduction with no significant utility decrease.