Service Parts Inventory Control with Lateral Transshipment that takes Time
AbstractIn equipment-intensive industries such as truck manufacturing, electronics manufacturing, photo copiers,and airliners, service parts are often slow moving items for which, in some cases, the transshipment timeis not negligible. However, this aspect is hardly considered in the existing spare parts literature. We assessthe effect of non-negligible lateral transshipment time on various aspects of spare parts inventory control.Furthermore, we introduce customer-oriented service levels by taking the uncommitted pipeline stocks intoaccount. A case study in the dredging industry shows that lateral transshipment may lead to lower systemperformance, which supports the results from some recent studies. Furthermore, we find that considerablesavings can be obtained when we include the uncommitted pipeline stocks in both base stock allocation andlateral transshipment decisions.
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Bibliographic InfoPaper provided by Tinbergen Institute in its series Tinbergen Institute Discussion Papers with number 10-025/4.
Date of creation: 26 Feb 2010
Date of revision: 10 Mar 2010
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Inventory Control; Lateral Transshipment; METRIC; Customer-oriented Service Level;
Other versions of this item:
- Yang, G. & Dekker, R., 2010. "Service Parts Inventory Control with Lateral Transshipment that Takes Time," Econometric Institute Research Papers, Erasmus University Rotterdam, Erasmus School of Economics (ESE), Econometric Institute EI 2010-02, Erasmus University Rotterdam, Erasmus School of Economics (ESE), Econometric Institute.
- C44 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Operations Research; Statistical Decision Theory
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-09-03 (All new papers)
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- Wong, Hartanto & Cattrysse, Dirk & Van Oudheusden, Dirk, 2005. "Stocking decisions for repairable spare parts pooling in a multi-hub system," International Journal of Production Economics, Elsevier, Elsevier, vol. 93(1), pages 309-317, January.
- Banerjee, Avijit & Burton, Jonathan & Banerjee, Snehamay, 2003. "A simulation study of lateral shipments in single supplier, multiple buyers supply chain networks," International Journal of Production Economics, Elsevier, Elsevier, vol. 81(1), pages 103-114, January.
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- Kutanoglu, Erhan & Mahajan, Mohit, 2009. "An inventory sharing and allocation method for a multi-location service parts logistics network with time-based service levels," European Journal of Operational Research, Elsevier, Elsevier, vol. 194(3), pages 728-742, May.
- Sven Axsäter, 1990. "Modelling Emergency Lateral Transshipments in Inventory Systems," Management Science, INFORMS, INFORMS, vol. 36(11), pages 1329-1338, November.
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