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A new class of stock-level dependent ordering policies for perishables with a short maximum shelf life

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  • Haijema, René

Abstract

Many perishables such as fresh food and blood platelet concentrates are characterized by a short maximum shelf life. As demand is often highly uncertain the outdating and shortages figures can be very high, especially when frequent replenishment is not possible or inefficient due to fixed ordering cost. We present a new class of stock-level dependent ordering policies: the (s,S,q,Q) policy, which is a periodic review (s,S) policy with the order quantity restricted by a minimum (q) and maximum (Q). Optimal (weekday dependent) parameter values are derived by dynamic programming and simulation. The (s,S,q,Q) policy performs nearly optimal and improves the (s,S) policies in many cases by 4–25%.

Suggested Citation

  • Haijema, René, 2013. "A new class of stock-level dependent ordering policies for perishables with a short maximum shelf life," International Journal of Production Economics, Elsevier, vol. 143(2), pages 434-439.
    • Handle: RePEc:eee:proeco:v:143:y:2013:i:2:p:434-439
    DOI: 10.1016/j.ijpe.2011.05.021
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    References listed on IDEAS

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    1. Steven Nahmias, 1982. "Perishable Inventory Theory: A Review," Operations Research, INFORMS, vol. 30(4), pages 680-708, August.
    2. Haijema, René & van Dijk, Nico & van der Wal, Jan & Smit Sibinga, Cees, 2009. "Blood platelet production with breaks: optimization by SDP and simulation," International Journal of Production Economics, Elsevier, vol. 121(2), pages 464-473, October.
    3. Brant E. Fries, 1975. "Optimal Ordering Policy for a Perishable Commodity with Fixed Lifetime," Operations Research, INFORMS, vol. 23(1), pages 46-61, February.
    4. Hill, Roger M. & Johansen, Soren Glud, 2006. "Optimal and near-optimal policies for lost sales inventory models with at most one replenishment order outstanding," European Journal of Operational Research, Elsevier, vol. 169(1), pages 111-132, February.
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