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 examines the effect that product pricing has on the dynamics and variability of a supply chain, with a focus in retail inventory. Pricing policies and strategies and the impacts of prices on demand and inventories within the retail supply chain environment are reviewed. Recent pricing and markdown research is examined. An example model is presented that is stochastic and uses simulat...

This paper studies supply chain demand variability in a model with one supplier and N retailers that face stochastic demand. Retailers implement scheduled ordering policies: Orders occur at fixed intervals and are equal to some multiple of a fixed batch size. A method is presented that exactly evaluates costs. Previous research demonstrates that the supplier’s demand variance declines as the re...

We consider combined inventory control and throughput time reduction in multi-echelon, multiindenture spare part networks for system upkeep of capital goods. We construct a model in which standard throughput times (TPT) for repair and transportation can be reduced at additional costs. We first estimate the marginal impact of TPT reduction on the system availability. Next, we develop an optimiza...

This paper examines the assertion that partial pooling of customers is sometimes favored over complete pooling on the sole basis of demand correlation. First, the management of inventory within a supply chain is discussed, with speci2c attention paid to risk-pooling. Then, the claim that partial pooling can dominate is theoretically discussed. The conditions under which previous research found ...

Inventory control policies have been recognized as a contributory factor to the bullwhip effect and inventory instability. Previous studies have indicated that there is a trade-off between bullwhip effect and inventory performance where the bullwhip effect reduction might increase inventory instability. Therefore, there is a need for inventory control policies that can cope with supply chain dy...

In this paper, we describe a simulation-based inventory management tool developed for the IBM Enterprise Server Group. Through the Web interface of the tool, an inventory manager is able to visualize Days of Supply (DOS) levels – current and projected, and to carry out what-if scenario analysis to identify potential opportunities for improvement. The highly complicated server manufacturing envi...

In this paper, the cost function for a three-echelon inventory system with two warehouses is derived. Transportation times are constant and retailers face independent Poisson demand. Replenishments are one-for-one. The lead time of a retailer is determined not only by the constant transportation time but also by the random delay incurred due to the availability of stock at the warehouses. We co...

Supply chain inventories are prone to fluctuations and instability. Known as the bullwhip effect, small variations in the end item demand create oscillations that amplify throughout the chain. By using system dynamics simulation, we investigate some of the structural sources of the bullwhip effect, and explore the effectiveness of information sharing to eliminate the undesirable fluctuations. E...

We consider inventory control in a two-echelon divergent network, consisting of a central depot and multiple (non-identical) local warehouses. Past research has shown that (R, S) order-up-to control rules for this system type can easily be obtained using a decomposition approach, where the derivation of the order-up-to level S is separated from the derivation of the rationing parameters. We sho...