We present and study a three-stage model of a decentralized distribution system consisting of n retailers, each of whom faces a stochastic demand for an identical product. In the first stage, before the demand is realized, each retailer independently orders her initial inventory. In the second stage, after the demand is realized, each retailer decides how much of her residual supply/demand she ...

When we try to solve a real-world problem, due to the complexity and uncertainty nature of the problem, we first tend to describe it under a stochastic model, based on which we then try to find the solution. Therefore, how to model becomes an important and interesting area of either theoretical or practical research. This special issue of IJOR covers the recent advances in stochastic modeling a...

We investigate the first-passage properties of bursty random walks on a finite one-dimensional interval of length L, in which unit-length steps to the left occur with probability close to one, while steps of length b to the right— ‘bursts’—occur with small probability. This stochastic process provides a crude description of the early stages of virus spread in an organism after exposure. The int...

Demand fluctuations that cause variations in output levels will affect a firm’s technical inefficiency. To assess this demand effect, a demand-truncated production function is developed and an “effectiveness” measure is proposed. Often a firm can adjust some input resources influencing the output level in an attempt to match demand. We proposes a short-run capacity planning method, termed proac...

We study the impact of the efforts aimed at reducing the lead-time variability in a quality-adjusted stochastic inventory model. We assume that each lot contains a random number of defective units. More specifically, a logarithmic investment function is used that allows investment to be made to reduce lead-time variability. Explicit results for the optimal values of decision variables as well a...

This work is motivated by the need to solve the inventory routing problem when implementing a business practice called vendor managed inventory replenishment (VMI). With VMI, vendors monitor their customers’ inventories, and decide when and how much inventory should be replenished at each customer. The inventory routing problem attempts to coordinate inventory replenishment and transportation i...

Torque fluctuations due to magnetorotational turbulence in proto-planetary disks may greatly influence the migration patterns and survival probabilities of nascent planets. Provided that the turbulence is a stationary stochastic process with finite amplitude and correlation time, the resulting diffusive migration can be described with a FokkerPlanck equation, which we reduce to an advection-dif...

In many industrial environments there is a significant class of problems for which the perishable nature of the inventory cannot be ignored in developing replenishment order plans. Food is the most salient example of a perishable inventory item. In this work, we consider the periodic-review, single-location, single-product production/inventory control problem under non-stationary stochastic dem...