Intuition may lead to the hypothesis that in stochastic inventory systems a higher demand variability results in larger variances and in an increase of total expected system costs. In a recent paper, Song [5] formally proved this assertion to hold for a certain class of inventory models (including the Newsboy Problem), given a particular definition of variability. Here we use stochastic dominan...

Retailers, from fashion stores to grocery stores, have to decide what range of products to offer (assortment planning) and what prices to charge (price optimization). New business trends, such as mass customization and shorter product life cycles, make predicting demand more difficult, which in turn complicates assortment planning and price optimization. We propose and study a stochastic dynami...

Variability, in general, has a deteriorating effect on the performance of stochastic inventory systems. In particular, previous results indicate that demand variability causes a performance degradation in terms of inventory related costs when production capacity is unlimited. In order to investigate the effects of demand variability in capacitated production settings, we analyse a make-to-stock...

The stochastic nature of emergency service requests and the unavailability of emergency vehicles when requested to serve demands are critical issues in constructing valid models representing real life emergency medical service (EMS) systems. We consider an EMS system design problem with stochastic demand and locate the emergency response facilities and vehicles in order to ensure target levels ...

This paper discusses the issue of order crossover and its effects in order point, lot size (s, Q) inventory systems. Orders are likely to cross when their lead times are stochastic. Two inventory systems are considered to examine the consequences of order crossover. The first inventory system considers a fast moving item having deterministic demand and stochastic lead time. It is assumed lead t...

1 We extend the existing toll pricing studies with fixed demand to stochastic demand. A new and 2 practical second-best pricing problem with uncertain demand is proposed and formulated as a 3 stochastic mathematical program with equilibrium constraints. In view of the problem structure, 4 we develop a tailored global optimization algorithm. This algorithm incorporates a sample 5 average approxi...

The integration of marketing and demand with logistics and inventories (supply side of companies) may cause multiple improvements; it can revolutionize the management of the revenue of rental companies, hotels, and airlines. In this paper, we develop a multi-objective pricing-inventory model for a retailer. Maximizing the retailer's profit and the service level are the objectives, and shorta...

Health care administrators commonly employ two types of resource flexibilities (demand upgrades and staffing flexibility) to efficiently coordinate two critical internal resources, nursing staff and beds, and an external resource (contract nurses) to satisfy stochastic patient demand. Under demand upgrades, when beds are unavailable for patients in a less acute unit, patients are upgraded to a ...

The intermittent nature of renewable energy has been discussed in the context of the operational challenges that it brings to electrical grid reliability. Demand Side Management (DSM) with its ability to allow customers to adjust electricity consumption in response to market signals has often been recognized as an efficient way to mitigate the variable effects of renewable energy as well as to ...

In most production-inventory systems, the products are transferred from the production centre to the inventory (warehouse) in subbatchs rather than one at a time. In this paper, mathematical models of such systems for both deterministic and stochastic cases of demand are developed and analysed. Comparison of these new models with the EBQ model shows a considerable loss when applying the ru...