One of the main supply chain deficiencies is the bullwhip effect: demand fluctuations increase as one moves up the supply chain from retailer to manufacturer. The Beer Distribution Game is widely known for illustrating these supply chain dynamics in class. In this paper we present a spreadsheet application, exploring the two key causes of the bullwhip effect: demand forecasting and the type of ...

In this paper we consider a 1-warehouse, N-retailer inventory system where demand occurs at all locations. We introduce an inventory model which allows us to set different service levels for retailers and direct customer demand at the warehouse. For each retailer a critical level is defined, such that a retailer replenishment order is delivered from warehouse stock if and only if the stock leve...

Supply chain management is an integrative approach for planning and control of materials and information flows with suppliers and customers as well as between different functions within a company. One particularly important element in supply chain management is the management of inventories. This field has received considerable attention during the last years. Nevertheless, most quantitative an...

This paper considers a two-level supply chain consisting of a manufacturer and two buyers. The manufacturer produces one type of products at a finite rate and replenishes them to the buyers. Each buyer’s demand is sensitive to his selling price and the backorder is allowed at the buyers. Moreover, it is assumed that the buyers delay paying for goods to the manufacturer and two types of delay in...

One area in which experimental economics methods have been used to study operations problems is supply-chain management. We survey results from a series of human experiments based on the popular beer distribution game and find cognitive limitations on the part of managers, in particular an underweighting of the supply line. We suggest mechanisms that may alleviate this bias, including sharing i...

A supply-chain is a series of connected stock management structures. Therefore, the structure of a supply-chain consists of many cascading inventory management problems. It is known that the optimal inventory control parameter values suggested by the literature are also valid for a supply-chain. The motivation for this study is to investigate the effect of the literature suggested optimal value...

We consider a two-echelon supply chain: a single retailer holds a finished goods inventory to meet an i.i.d. customer demand, and a single manufacturer produces the retailer’s replenishment orders on a make-to-order basis. In this setting the retailer’s order decision has a direct impact on the manufacturer’s production. It is a well known phenomenon that inventory control policies at the retai...

We review multi-echelon inventory models for repairable items. Such models have been widely applied to the management of critical spare parts for military equipment for around three decades, but the application to manufacturing and service industries seems to be much less documented. We feel that the appropriate use of models in the management of spare parts for heavily utilized equipment in in...

We consider a multi-product serial two echelon inventory system with stochastic demand. Inventories at the downstream location are replenished periodically using an automatic ordering system. Under vendor managed inventory strategies the upstream stage is allowed to adapt these orders in order to benefit from economies of scale. We propose three different VMI strategies, aiming to reduce the or...

  This paper aims to evaluate inventory cost of a Two-echelon serial supply chain system under vendor managed inventory program with stochastic demand, and examine the effect of environmental factors on the cost of overall system. For this purpose, we consider a two-echelon serial supply chain with a manufacturer and a retailer. Under Vendor managed inventory program, the decision on inventory ...