Abstract
We survey the recent literature on the use of spot market operations to manage procurement in supply chains. We present results in two categories: work that deals with optimal procurement strategies and work related to the valuation of procurement contracts. As an example of the latter, we provide new results on valuation of a supply contract with abandonment option. Based on our review, we also discuss the scope for doing further work.
| Original language | English (US) |
|---|---|
| Pages (from-to) | 1412-1429 |
| Number of pages | 18 |
| Journal | Journal of the Operational Research Society |
| Volume | 58 |
| Issue number | 11 |
| DOIs | |
| State | Published - Nov 2007 |
| Externally published | Yes |
Keywords
- Practice of OR
- Real options
- Risk
- Stochastic dynamic programming
- Supply chain contracts
ASJC Scopus subject areas
- Management Information Systems
- Strategy and Management
- Management Science and Operations Research
- Marketing