This paper studies a two-echelon supply chain with stochastic and discrete consumer demand, batch order quantities, periodic inventory review, and deterministic transportation times. Reorder point policies manage inventories at every location. Average inventory, backorders and fill rates are evaluated exactly for each location. Safety stock is evaluated exactly at the lower echelon and a good a...

Stochastic inventory control in multi-echelon systems poses hard problems in optimisation under uncertainty. Stochastic programming can solve small instances optimally, and approximately solve large instances via scenario reduction techniques, but it cannot handle arbitrary nonlinear constraints or other nonstandard features. Simulation optimisation is an alternative approach that has recently ...

We present a two-echelon dual-channel inventory model in which stocks are kept in both a manufacturer warehouse (upper echelon) and a retail store (lower echelon), and the product is available in two supply channels: a traditional retail store and an Internet-enabled direct channel. The system receives stochastic demand from two customer segments: those who prefer the traditional retail store a...

An arborescent distribution system is a multi-level system in which each installation receives input from a unique immediate predecessor and supplies one or more immediate successors. In this paper, it is shown that a distribution system with an arborescent structure can also be modelled using an echelon stock concept where at any instant the total echelon holding cost is accumulated at the sam...

We study a multi-item, two-echelon, continuous-review inventory problem at a Dutch utility company, Liander. We develop a model that optimizes the quantities of service parts and their allocation in the two-echelon network under an aggregate waiting time restriction. Specific aspects that we address are emergency shipments in case of stockout, and batching for regular replenishment orders at th...

This paper focuses on the development of simulation-based environment for multi-echelon cyclic planning and optimisation in the product maturity phase. It is based on integration of analytical and simulation techniques. Analytical techniques are used to obtain initial planning decisions under conditions of stochastic demand and lead time, whereas simulation techniques extend these conditions to...

The effective management of supply chains depends upon the ability of decision makers to control inventory while maintaining customer service at low cost. This paper examines an analytical model for the two-echelon one warehouse and multiple retailers system using (R, Q) inventory policies. A simulation model was developed to analyze the performance of the analytical model under conditions that...