We propose a novel approach to optimum inventory control by modeling a commodity trader’s inventory investment as a portfolio of forward commitments taking explicit account of the dynamics of demands, costs and prices in open markets. We apply the robust real-asset martingale valuation methodology to derive a closed-form solution for the inventory value and a simple and intuitive optimality con...

We analyze an infinite horizon, single-product, periodic review model in which pricing and production/inventory decisions are made simultaneously. Demands in different periods are identically distributed random variables that are independent of each other, and their distributions depend on the product price. Pricing and ordering decisions are made at the beginning of each period, and all shorta...

We propose a new sample efficient algorithm to learn the parameters governing the purchasing behavior of a utility maximizing buyer, who responds to prices, in a repeated interaction setting. The key feature of our algorithm is that it can work with arbitrary price constraints that the seller may impose. This overcomes a major shortcoming of previous approaches, which use unrealistic prices to ...

Using a Proof of Concept approach, this paper examines RFID’s impact on inventory control of a small-to-medium retailer. Results indicate that RFID technology can function effectively in a small-to-medium hardware environment. Also, the majority of the simulations recorded reasonable read rates even though the simulations were set up over a short period of time without a great deal of fine-tuni...

Developing a closed-form cost expression for an (R,s,nQ) policy where the demand process is compound generalized Erlang Logistics/SCM Research Group 1 Developing a closed-form cost expression for an (R,s,nQ) policy where the demand process is compound generalized Erlang Abstract We derive a closed-form cost expression for an (R,s,nQ) inventory control policy where all replenishment orders have ...

Exponential smoothing is often used to forecast lead-time demand for inventory control. In this paper, formulae are provided for calculating means and variances of lead-time demand for a wide variety of exponential smoothing methods. A feature of many of the formulae is that variances, as well as the means, depend on trends and seasonal effects. Thus, these formulae provide the opportunity to i...

We study the global optimal solution for a planning problem of inventory control of perishable products and non-stationary demand.

The deal for industrial companies is to satisfy their customers with the best quality, the most reliable lead times, and the lowest costs. One of the keys to achieve it is in the inventory control in the Supply Chain. Moreover, it is mandatory to possess necessary components in order to produce the requested products by the due date. But, as the components lead time is an unpredictable paramete...

In this research, we deal with VMI (Vendor Managed Inventory) problem where one supplier is responsible for managing a retailer’s inventory under unstable customer demand situation. To cope with the nonstationary demand situation, we develop a retrospective action-reward learning model, a kind of reinforcement learning techniques, which is faster in learning than conventional action-reward lear...