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Consolidation effects: Whether and how inventories should be pooled

Author

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  • Wanke, Peter F.
  • Saliby, Eduardo

Abstract

This paper presents a framework for deciding whether and how inventories should be pooled, using the consolidation effect as a cornerstone tool to measure inventory costs, service levels, and total costs. Based on the random generation of different scenarios, it is indicated the adequacy of inventory centralization, regular transshipments, and independent systems to a given set of demand, lead time, and holding costs characteristics. Sensitivity analyses on mathematical expressions are performed to determine when one alternative is preferable in terms of total costs. Real settings are also presented in light of the framework developed.

Suggested Citation

  • Wanke, Peter F. & Saliby, Eduardo, 2009. "Consolidation effects: Whether and how inventories should be pooled," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 45(5), pages 678-692, September.
    • Handle: RePEc:eee:transe:v:45:y:2009:i:5:p:678-692
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    Citations

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    Cited by:

    1. Khouloud Dorgham & Issam Nouaouri & Jean-Christophe Nicolas & Gilles Goncalves, 2022. "Collaborative hospital supply chain network design problem under uncertainty," Operational Research, Springer, vol. 22(5), pages 4607-4640, November.
    2. Braglia, M. & Frosolini, M., 2013. "Virtual pooled inventories for equipment-intensive industries. An implementation in a paper district," Reliability Engineering and System Safety, Elsevier, vol. 112(C), pages 26-37.
    3. Mourad Makaci & Paul J. Reaidy & Karine Evrard Samuel & Valérie Botta-Genoulaz & Thibaud Monteiro, 2017. "Pooled warehouse management : An empirical study," Post-Print hal-01531304, HAL.
    4. Ponte, Borja & Costas, José & Puche, Julio & Pino, Raúl & de la Fuente, David, 2018. "The value of lead time reduction and stabilization: A comparison between traditional and collaborative supply chains," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 111(C), pages 165-185.
    5. Wang, Wenbin & Yue, Shuai, 2015. "An inventory pooling model for spare units of critical systems that serve multi-companies," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 76(C), pages 34-44.
    6. Wanke, Peter F., 2012. "Product, operation, and demand relationships between manufacturers and retailers," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 48(1), pages 340-354.
    7. Hosang Jung & Sukjae Jeong, 2018. "The Economic Effect of Virtual Warehouse-Based Inventory Information Sharing for Sustainable Supplier Management," Sustainability, MDPI, vol. 10(5), pages 1-19, May.

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