Unsold inventory management and off-price retailers’ selection for multiple items

Abstract

In this research, we address the issue of outsourcing the clearance operation to a third party, in the context of multi-partner and multi-product. The outsourcing operation is a widespread industrial practice and requires a welldefined process to follow to be successful. Indeed, to choose the best partners (or retailers) from a potential set of candidates, a company must define its selection criteria, as well as the selection method that should be applied. This paper aims to develop a framework for the clearance partner selection process. Using multi-objective optimization and based on the suppliers' evaluation according to the established criteria, appropriate partners are selected, and optimal allocation of unsold quantity is determined.