2018/01/07 by Atiyeh Ashari Ghomi, Allan Borodin, Ghomi, Atiyeh Ashari +3
Business, Management and Accounting · Computer Science · Decision Sciences · Economics, Econometrics and Finance · #Auction Theory and Applications #Computer Science and Game Theory (cs.GT) #Economic theories and models #FOS: Computer and information sciences #Supply Chain and Inventory Management #cs.GT
paper · pdf · doi:10.48550/arxiv.1801.02263
openalex publication_date 2018/01/07 · arxiv created 2018/05/06 · arxiv updated 2018/05/08 · openalex created_date 2025/10/10 · openalex updated_date 2026/07/28
We examine the case of items with a limited shelf-life where storing an item (before consumption) may carry a cost to a buyer (or distributor). For example, eggs, milk, or Groupon coupons have a fixed expiry date, and seasonal goods can suffer a decrease in value. We show how this setting contrasts with recent results by Berbeglia et al (arXiv:1509.07330(v5)) for items with infinite shelf-life. We prove tight bounds on the seller's profits showing how they relate to the items' shelf-life. We show, counterintuitively, that in our limited shelf-life setting, increasing storage costs can sometimes lead to less profit for the seller which cannot happen when items have unlimited shelf-life. We also provide an algorithm that calculates optimal prices. Finally, we examine empirically the relationship between profits and buyer utility as the storage cost and shelf-life duration change, and observe properties, some of which are unique to the limited shelf-life setting.