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Article: Analysis of optimal opportunistic replenishment policies for inventory systems by using a (s,S) model with a maximum issue quantity restriction

TitleAnalysis of optimal opportunistic replenishment policies for inventory systems by using a (s,S) model with a maximum issue quantity restriction
Authors
Keywords(S,S) Policy
Inventory Control
Maximum Issue Quantity
Opportunistic Replenishment
Issue Date2005
PublisherElsevier BV. The Journal's web site is located at http://www.elsevier.com/locate/ejor
Citation
European Journal Of Operational Research, 2005, v. 166 n. 2, p. 385-405 How to Cite?
AbstractThe analysis of optimal inventory replenishment policies for items having lumpy demand patterns is difficult, and has not been studied extensively although these items constitute an appreciable portion of inventory populations in parts and supplies types of stockholdings. This paper studies the control of an inventory item when the demand is lumpy. A continuous review (s,S) policy with a maximum issue quantity restriction and with the possibility of opportunistic replenishment is proposed to avoid the stock of these items being depleted unduly when all the customer orders are satisfied from the available inventory and to reduce ordering cost by coordinating inventory replenishments. The nature of the customer demands is approximated by a compound Poisson distribution. When a customer order arrives, if the order size is greater than the maximum issue quantity w, the order is satisfied by placing a special replenishment order rather than from the available stock directly. In addition, if the current inventory position is equal to or below a critical level A when such an order arrives, an opportunistic replenishment order which combines the special replenishment order and the regular replenishment order will be placed, in order to satisfy the customer's demand and to bring the inventory position to S. In this paper, the properties of the cost function of such an inventory system with respect to the control parameters s, S and A are analysed in detail. An algorithm is developed to determine the global optimal values of the control parameters. Indeed, the incorporation of the maximum issue quantity and opportunistic replenishment into the (s,S) policy reduces the total operating cost of the inventory system. © 2004 Elsevier B.V. All rights reserved.
Persistent Identifierhttp://hdl.handle.net/10722/155869
ISSN
2015 Impact Factor: 2.679
2015 SCImago Journal Rankings: 2.595
ISI Accession Number ID
References

 

DC FieldValueLanguage
dc.contributor.authorMak, KLen_US
dc.contributor.authorLai, KKen_US
dc.contributor.authorNg, WCen_US
dc.contributor.authorYiu, KFCen_US
dc.date.accessioned2012-08-08T08:38:06Z-
dc.date.available2012-08-08T08:38:06Z-
dc.date.issued2005en_US
dc.identifier.citationEuropean Journal Of Operational Research, 2005, v. 166 n. 2, p. 385-405en_US
dc.identifier.issn0377-2217en_US
dc.identifier.urihttp://hdl.handle.net/10722/155869-
dc.description.abstractThe analysis of optimal inventory replenishment policies for items having lumpy demand patterns is difficult, and has not been studied extensively although these items constitute an appreciable portion of inventory populations in parts and supplies types of stockholdings. This paper studies the control of an inventory item when the demand is lumpy. A continuous review (s,S) policy with a maximum issue quantity restriction and with the possibility of opportunistic replenishment is proposed to avoid the stock of these items being depleted unduly when all the customer orders are satisfied from the available inventory and to reduce ordering cost by coordinating inventory replenishments. The nature of the customer demands is approximated by a compound Poisson distribution. When a customer order arrives, if the order size is greater than the maximum issue quantity w, the order is satisfied by placing a special replenishment order rather than from the available stock directly. In addition, if the current inventory position is equal to or below a critical level A when such an order arrives, an opportunistic replenishment order which combines the special replenishment order and the regular replenishment order will be placed, in order to satisfy the customer's demand and to bring the inventory position to S. In this paper, the properties of the cost function of such an inventory system with respect to the control parameters s, S and A are analysed in detail. An algorithm is developed to determine the global optimal values of the control parameters. Indeed, the incorporation of the maximum issue quantity and opportunistic replenishment into the (s,S) policy reduces the total operating cost of the inventory system. © 2004 Elsevier B.V. All rights reserved.en_US
dc.languageengen_US
dc.publisherElsevier BV. The Journal's web site is located at http://www.elsevier.com/locate/ejoren_US
dc.relation.ispartofEuropean Journal of Operational Researchen_US
dc.rightsEuropean Journal of Operational Research. Copyright © Elsevier BV.-
dc.subject(S,S) Policyen_US
dc.subjectInventory Controlen_US
dc.subjectMaximum Issue Quantityen_US
dc.subjectOpportunistic Replenishmenten_US
dc.titleAnalysis of optimal opportunistic replenishment policies for inventory systems by using a (s,S) model with a maximum issue quantity restrictionen_US
dc.typeArticleen_US
dc.identifier.emailMak, KL:makkl@hkucc.hku.hken_US
dc.identifier.emailNg, WC:ngwc@hkucc.hku.hken_US
dc.identifier.emailYiu, KFC:cedric@hkucc.hku.hken_US
dc.identifier.authorityMak, KL=rp00154en_US
dc.identifier.authorityNg, WC=rp00160en_US
dc.identifier.authorityYiu, KFC=rp00206en_US
dc.description.naturelink_to_subscribed_fulltexten_US
dc.identifier.doi10.1016/j.ejor.2002.05.001en_US
dc.identifier.scopuseid_2-s2.0-13544252490en_US
dc.identifier.hkuros109857-
dc.relation.referenceshttp://www.scopus.com/mlt/select.url?eid=2-s2.0-13544252490&selection=ref&src=s&origin=recordpageen_US
dc.identifier.volume166en_US
dc.identifier.issue2en_US
dc.identifier.spage385en_US
dc.identifier.epage405en_US
dc.identifier.isiWOS:000229050700006-
dc.publisher.placeNetherlandsen_US
dc.identifier.scopusauthoridMak, KL=7102680226en_US
dc.identifier.scopusauthoridLai, KK=7402135562en_US
dc.identifier.scopusauthoridNg, WC=7401613494en_US
dc.identifier.scopusauthoridYiu, KFC=24802813000en_US

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