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Centralized Inventory Control in a Two-Level Distribution System vith Poisson demand

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Author

Summary, in English

This paper introduces a new replenishment policy for inventory control in a two-level distribution system consisting of one central warehouse and an arbitrary number of nonidentical retailers. The new policy is designed to control the replenishment process at the

central warehouse, using centralized information regarding the inventory positions and demand processes of all installations in the system. The retailers on the other hand are assumed to use continuous review (R,Q) policies. A technique for exact evaluation of the expected inventory holding and backorder costs for the system is presented. Numerical results indicate that there are cases when considerable savings can be made by using the new (R0, Q0) policy instead of a traditional echelon- or installation-stock (R, Q) policy.

Publishing year

2002

Language

English

Pages

798-822

Publication/Series

Naval Research Logistics

Volume

49

Document type

Journal article

Publisher

John Wiley & Sons Inc.

Topic

  • Transport Systems and Logistics

Keywords

  • stochastic demand
  • centralized control
  • echelon stock
  • installation stock
  • distribution system
  • multiechelon
  • inventory systems

Status

Published

ISBN/ISSN/Other

  • ISSN: 0894-069X