In multi-location inventory systems, transshipments are often used to improve customer service and reduce cost. Determining optimal transshipment policies for such systems involves a complex optimisation problem that is only tractable for systems with few locations. Consequently simple heuristic transshipment policies are often applied in practice. This paper develops an approximate solution me...

In the current global market, organizations use many promotional tools to increase their sales. One such tool is sales teams’ initiatives or promotional policies, i.e., free gifts, discounts, packaging, etc. This phenomenon motivates the retailer/or buyer to order a large inventory lot so as to take full benefit of promotional policies. In view of this the present paper considers a two-warehous...

Decision making plays an important role in economics, psychology, philosophy, mathematics, statistics and many other fields. In each field, decision making consists of identifying the values, uncertainties and other issues that define the decision. In any field, the nature of the decisions is affected by environmental characteristics. In this paper, we are considered the production planning pro...

At one time, JEAB editorial policy was perceived by some to consist mainly of dogmatically enforcing a Skinnerian interpretation of all findings reported in the journal. Partly in response to that undeserved reputation, the journal explicitly defined itself as the place to publish research on the behavior of individual organisms, and not as a place that encourages any particular theoretical ori...

To have an efficient control of a huge amount of inventory items, traditional approach is to classify the inventory into different groups. Different inventory control policies can then applied to different groups. The well-known ABC classification is simple-to-understand and easy-to-use. However, ABC analysis is based on only single measurement such as annual dollar usage. It has been recognize...

We estimate a DSGE model with (S,s) inventory policies. We …nd that (i) taking inventories into account can signi…cantly improve the empirical …t of DSGE models in matching the standard business-cycle moments (in addition to explaining inventory ‡uctuations); (ii) (S,s) inventory policies can signi…cantly amplify aggregate output ‡uctuations, in contrast to the …ndings of the recent general-equ...

A two-stage inventory system is considered where Poisson demand occurs at Stage 1, and Stage 1 replenishes its inventory from Stage 2, which in turn orders from an outside supplier with unlimited stock. Each shipment, either to Stage 2 or to Stage 1, incurs a fixed setup cost. Under the assumption that the supply leadtime at Stage 2 is zero, we characterize a simple heuristic policy whose long-...

We address the problem of determining optimal ordering and pricing policies in a finite-horizon newsvendor model with unobservable lost sales. The demand distribution is price-dependent and involves unknown parameters. We consider both the cases of perishable and non-perishable inventory. A very general class of demand functions is studied in this paper. We derive the optimal ordering and prici...

In this paper, we consider a periodic review inventory system and present its optimal policy in the infinite horizon setting. The optimal inventory policy that maximizes the infinite horizon expected discounted profit for the model is analytically obtained and proved to be an order-up-to policy. Results are also provided that elucidate the operations of the inventory system in the long run. Thi...

For general state and action space Markov decision processes, we present sufficient conditions for the existence of solutions of the average cost optimality inequalities. These conditions also imply the convergence of both the optimal discounted cost value function and policies to the corresponding objects for the average costs per unit time case. Inventory models are natural applications of ou...