Fuzzy multi-objective programming problem for revenue management in food industry
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RESEARCH ARTICLE
Fuzzy multi‑objective programming problem for revenue management in food industry Neha Gupta1 · J. K. Sharma1 Received: 23 December 2019 / Accepted: 18 February 2020 © Springer Nature Limited 2020
Abstract Food industry is one of the fastest growing industry. With the development of varieties in this industry, the need for revenue management is vital. Revenue management is a technique to optimize the income by selling the right product to right customer at right time which is done by using data driven tactics and strategies. In this paper, a revenue management problem is formulated as multi-objective programming problem in an uncertain environment. As in real life situations most of the parameters are generally uncertain, therefore cost parameter considered as triangular fuzzy numbers. Fuzzy problem is converted into deterministic problem by alpha-cut method and then the algorithm is developed to solve the multi-objective linear programming problem to optimize revenue as well as cost simultaneously. To demonstrate and justify the formulated problem a numerical illustration has been considered and solved. All the mathematical problems are solved through an optimisation software LINGO-13. Keywords Multi-objective programming problem · Revenue management · Fuzzy numbers · Fuzzy programming
Introduction The market in the dynamic environment varies a lot due to many factors. Inflation, deflation is part and parcel in today’s scenario. Every industry is affected, which leads to an impact on sales. But food industry is the only industry which remains unaffected in terms of sales with respect to inflation and deflation. This is because food is the basic necessity. So, dealers of food industry can have stable or increasing revenues by constantly managing the same in various conditions. Revenue management is not a new term to this; in fact it has evolved with the time. It is a successful operational technique in order to optimize the efficiency and increase profitability. As revenue management also suggests selling right food item to right customer in order to amplify the profits. Food industry always needs to make best product without any wastage of scarce resources and not compromising on the quality of the ingredients to be used. To deal with this problem linear programming (LP) is one of the most popular mathematical programming technique for optimum * Neha Gupta [email protected] 1
Amity School of Business, Amity University Uttar Pradesh, Noida, India
allocation of scarce resources on the basis of different criteria of optimality. Since realistic problems are inherent of imprecision and uncertainty, therefore uncertain parameters are used by approximating their values. However, it may not resulting to the actual solutions to problems. Revenue management needs an intelligent decision making, but in the presence of high degree of fuzziness and uncertainties, the fuzzy set theory is the best tool in handling the uncertain parameters. Zadeh et al. (1965) introduced fuzzy set theory to cope with t
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