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Myopic inventory policies using individual customer arrival information

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  • Martinez de Albeniz, Victor

    (IESE Business School)

  • Lago, Alejandro

    (IESE Business School)

Abstract

We investigate optimality of myopic policies using the single-unit decomposition approach in inventory management. We derive, under certain conditions, closed-form replenishment decisions, which we call a base-probability policy. That is, the order associated with a given customer is placed if and only if its arrival probability within the lead-time is higher than a threshold.

Suggested Citation

  • Martinez de Albeniz, Victor & Lago, Alejandro, 2007. "Myopic inventory policies using individual customer arrival information," IESE Research Papers D/719, IESE Business School.
    • Handle: RePEc:ebg:iesewp:d-0719
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    File URL: http://www.iese.edu/research/pdfs/DI-0719-E.pdf
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    References listed on IDEAS

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