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Approximate evaluation of batch‐ordering policies for a one‐warehouse, N non‐identical retailer system under compound poisson demand

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  • Sven Axsäter

Abstract

Considered is a two‐level inventory system with one central warehouse and N retailers facing different independent compound Poisson demand processes. The retailers replenish from the warehouse and the warehouse from an outside supplier. All facilities apply continuous review installation stock (R, Q) policies with different reorder points and batch quantities. Presented is a new approximate method for evaluation of holding and shortage costs, which can be used to select optimal policies. The accuracy of the approximation is evaluated by comparison with exact and simulated results. © 1995 John Wiley & Sons, Inc.

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  • Sven Axsäter, 1995. "Approximate evaluation of batch‐ordering policies for a one‐warehouse, N non‐identical retailer system under compound poisson demand," Naval Research Logistics (NRL), John Wiley & Sons, vol. 42(5), pages 807-819, August.
    • Handle: RePEc:wly:navres:v:42:y:1995:i:5:p:807-819
    DOI: 10.1002/1520-6750(199508)42:53.0.CO;2-P
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    References listed on IDEAS

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    1. R. M. Simon, 1971. "Stationary Properties of a Two-Echelon Inventory Model for Low Demand Items," Operations Research, INFORMS, vol. 19(3), pages 761-773, June.
    2. Hau L. Lee & Kamran Moinzadeh, 1987. "Operating characteristics of a two‐echelon inventory system for repairable and consumable items under batch ordering and shipment policy," Naval Research Logistics (NRL), John Wiley & Sons, vol. 34(3), pages 365-380, June.
    3. Kamran Moinzadeh & Hau L. Lee, 1986. "Batch Size and Stocking Levels in Multi-Echelon Repairable Systems," Management Science, INFORMS, vol. 32(12), pages 1567-1581, December.
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