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Multi-level inventory management decisions with transportation cost consideration

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Author Info

  • Madadi, Alireza
  • Kurz, Mary E.
  • Ashayeri, Jalal
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    Abstract

    In this article we address specific inventory management decisions with transportation cost consideration in a multi-level environment consisting of a supplier-warehouse-retailers. We develop two models - namely, decentralized ordering model and centralized ordering model to investigate the effect of collective ordering by retailers on the total inventory cost of the system. A numerical study shows that the proposed model is robust and generates reasonable cost savings. The models have potential in several multi-level applications such as fresh or frozen food delivery to stores of different supermarkets or the supply of medicine to a number of hospitals from a wholesaler.

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    File URL: http://www.sciencedirect.com/science/article/pii/S1366554509001628
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    Bibliographic Info

    Article provided by Elsevier in its journal Transportation Research Part E: Logistics and Transportation Review.

    Volume (Year): 46 (2010)
    Issue (Month): 5 (September)
    Pages: 719-734

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    Handle: RePEc:eee:transe:v:46:y:2010:i:5:p:719-734

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    Web page: http://www.elsevier.com/wps/find/journaldescription.cws_home/600244/description#description

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    Related research

    Keywords: Inventory management Decentralized ordering Centralized ordering Transportation;

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    Cited by:
    1. Ali, Agha Iqbal & O'Connor, Debra J., 2013. "Using truck-inventory-cost to obtain solutions to multi-period logistics models," International Journal of Production Economics, Elsevier, vol. 143(1), pages 144-150.

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