Computation of order and volume fill rates for a base stock inventory control system with heterogeneous demand to investigate which customer class gets the best service
We consider a base stock inventory control system serving two customer classes whose demands are generated by two independent compound renewal processes. We show how to derive order and volume fill rates of each class. Based on assumptions about first order stochastic dominance we prove when one customer class will get the best service. That theoretical result is validated through a series of numerical experiments which also reveal that it is quite robust.
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Paper provided by University of Aarhus, Aarhus School of Business, Department of Business Studies in its series CORAL Working Papers with number
L-2006-03.
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