A New Decision Rule for Lateral Transshipments in Inventory Systems
Författare
Summary, in English
This paper deals with a single-echelon inventory system consisting of a number of parallel local warehouses facing compound Poisson demand. There are standard holding and backorder costs as well as ordering costs at all warehouses. Normally, the warehouses replenish from an outside supplier. However, lateral transshipments between the warehouses are also possible. Such transshipments take no time but incur additional costs. When a demand occurs at a warehouse, the question is whether the whole demand or part of it should be covered by a lateral transshipment from another warehouse. Given a set of alternative decisions, our decision rule minimizes the expected costs under the assumption that no further transshipments will take place. This rule is then used repeatedly as a heuristic. A simulation study illustrates how the suggested technique performs under different conditions.
Avdelning/ar
Publiceringsår
2003
Språk
Engelska
Sidor
1168-1179
Publikation/Tidskrift/Serie
Management Science
Volym
49
Issue
9
Dokumenttyp
Artikel i tidskrift
Förlag
Informs
Ämne
- Transport Systems and Logistics
Nyckelord
- Inventory control
- Studies
- Management science
- Stochastic models
- Buffer inventories
Status
Published
ISBN/ISSN/Övrigt
- ISSN: 0025-1909