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Optimization and inventory management under stochastic demand using metaheuristic algorithm

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  • Nguyen Duy Tan
  • Hwan-Seong Kim
  • Le Ngoc Bao Long
  • Duy Anh Nguyen
  • Sam-Sang You

Abstract

This study considers multi-period inventory systems for optimizing profit and storage space under stochastic demand. A nonlinear programming model based on random demand is proposed to simulate the inventory operation. The effective inventory management system is realized using a multi-objective grey wolf optimization (MOGWO) method, reducing storage space while maximizing profit. Numerical outcomes are used to confirm the efficacy of the optimal solutions. The numerical analysis and tests for multi-objective inventory optimization are performed in the four practical scenarios. The inventory model’s sensitivity analysis is performed to verify the optimal solutions further. Especially the proposed approach allows businesses to optimize profits while regulating the storage space required to operate in inventory management. The supply chain performance can be significantly enhanced using inventory management strategies and inventory management practices. Finally, the novel decision-making strategy can offer new insights into effectively managing digital supply chain networks against market volatility.

Suggested Citation

  • Nguyen Duy Tan & Hwan-Seong Kim & Le Ngoc Bao Long & Duy Anh Nguyen & Sam-Sang You, 2024. "Optimization and inventory management under stochastic demand using metaheuristic algorithm," PLOS ONE, Public Library of Science, vol. 19(1), pages 1-25, January.
    • Handle: RePEc:plo:pone00:0286433
    DOI: 10.1371/journal.pone.0286433
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    References listed on IDEAS

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    1. Yu-Ren Chen & Chung-Yuan Dye, 2013. "Application of particle swarm optimisation for solving deteriorating inventory model with fluctuating demand and controllable deterioration rate," International Journal of Systems Science, Taylor & Francis Journals, vol. 44(6), pages 1026-1039.
    2. Soheyl Khalilpourazari & Seyed Hamid Reza Pasandideh, 2020. "Multi-objective optimization of multi-item EOQ model with partial backordering and defective batches and stochastic constraints using MOWCA and MOGWO," Operational Research, Springer, vol. 20(3), pages 1729-1761, September.
    3. Chiang, Chi, 2003. "Optimal replenishment for a periodic review inventory system with two supply modes," European Journal of Operational Research, Elsevier, vol. 149(1), pages 229-244, August.
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