Bidding decision optimization based on integer programming method - a case study of virtual company of Ewood Technology Company

Abstract

The report delves into the challenges faced by a Communication Base Station Equipment company. In January, the company encountered a financial crisis due to a lack of strategic consideration in bid management, particularly in terms of the number and geographical spread of tenders, leading to a negative profit margin. To address this, the report adopts integer programming as a tool to optimize profits for
both January and February. This approach includes modeling various variables such as monthly factory upgrades, delivery schedules, and procurement volumes. The parameters set for the model encompass decisions on bids, selections of factory delivery options, and quantities of materials to be procured. The primary objective is to maximize the total profit by the end of February.
There are specific recommendations, such as choosing four bids in January and seven in February, strategically distributed across two manufacturing facilities. Additionally, the report underscores the importance of managing total production time for all tenders to prevent negative impacts on subsequent tender processes and potential breaches of contracts.