A classification of literature on determining the lot size under quantity discounts

Determining a lot size in the presence of either all-units or incremental discounts has represented one of major interests of materials managers. It is a common practice that the suppliers offer quantity discount to entice the buyers to purchase more and to achieve economies of scale for transportation and processing costs. This paper will classify the literature on lot sizing determination under several types of discount schemes and discuss some of the significant literature in this area over two decades. Also, some future research areas have been identified.