The substitution between products is a common phenomenon in supply chain management when customers find their favorite product unavailable. Product substitution can improve the availability of different products and thus improve the customer service level, especially when the high-end product substitutes for the low-end product. In this paper, we construct profit model of downward substitution ...

We study a perishable inventory system that requires to maintain a minimum inventory volume at all times, where the minimum amount in the constraint is significant with respect to regular market demand and the traditional Economic Manufacturing Quantity (EMQ) models do not suffice. The problem is motivated by applications in homeland security, which are related to the management of pharmaceutic...

We study a perishable inventory system that requires to maintain a minimum inventory volume at all times, where the minimum amount in the constraint is significant with respect to regular market demand and the traditional Economic Manufacturing Quantity (EMQ) models do not suffice. The problem is motivated by applications in homeland security, which are related to the management of pharmaceutic...

We introduce a class of models, called newsvendor networks, that allow for multiple products and multiple processing and storage points and investigate how their single-period properties extend to dynamic settings. Such models provide a parsimonious framework to study various problems of stochastic capacity investment and inventory procurement. Newsvendor networks can feature commonality, ßexib...

The purpose of this paper is to develop a retailer's pro"t-maximizing myopic inventory policy for an item recognized as subject to gradual obsolescence. Demand is assumed to be a decreasing function of both the retailer's sale price and of time, up to a certain stochastic time point when obsolescence occurs and, as a result, the demand suddenly drops to zero. For each ordering cycle, the decisi...

We study stochastic inventory planning with lost sales, where contrary to classical inventory theory, the knowledge of the demand distribution is not available a priori. While the manager observes the sales quantities in each period, lost sales are unobservable, i.e., demand data is censored. The decision in each period depends only on historical sales data. Excess inventory is either perishabl...

As the transition to renewable energy sources progresses, their integration makes electricity production increasingly fluctuating, also causing amplified volatility in electricity prices on energy markets. To contribute to power grid stability, utilities need to balance volatile supply through shifting demand. This measure of demand side management creates flexibility, being enabled as the inte...

The major purpose of this paper is to apply a stochastic single-period inventory management approach to analyze optimal cash management policies with fuzzy cash demand based on fuzzy integral method so that total cost is minimized. We will find that, after defuzzification, the cash-raising amounts and the total costs between the fuzzy case and the crisp case are slightly different when the vari...