Lateral transshipments are an effective strategy to pool inventories. We present an exact Semi-Markov decision problem formulation for proactive and reactive transshipments in a multi-location continuous review distribution inventory system with Poisson demand and exponential replenishment lead times. In a numerical study, we investigate the benefits of proactive over different reactive transsh...

This means that the optimal order quantity Q∗ is such that the probability of having a demand larger than Q∗ is equal to the ratio of the overage cost h to the overage plus underage cost h+ p. Frequently D is assumed to be Poisson or Normally distributed. Unfortunately there is no closed form solution to equation (1) for these distributions of demand. However, the optimal order quantity against...

This paper addresses the inventory penalty pricing problem under risk-neutral valuation principle. In particular, we consider an inventory driven by a constant replenishment rate and compound renewal demand stream (iid demand inter-arrival time and iid demand quantity), and subject to overage penalties and underage penalties. Our solution approach treats the inventory penalties of overage and u...

Whenever demand for a single item can be categorized into classes of di erent priority an inventory rationing policy should be considered In this paper we analyse a continuous review s Q model with lost sales and two demand classes A so called critical level policy is applied to ration the inventory among the two demand classes With this policy low priority demand is rejected in anticipation of...

This paper reports on the demand for water-based leisure activity in Ireland based on data from a nationally representative telephone survey. Participation and trip demand are modelled using an augmented Poisson count model and consumer surplus welfare estimates are derived. The model is also used to investigate the level of social exclusion in water-based leisure activity. The demand for four ...

Managing spare parts inventories is a challenging task and can benefit considerably from any information on the failure rate of the parts. It has often been considered in the stock control literature that parts' failures are only random, caused by external events which results in the assumption of constant failure rate and therefore the consideration of the Poisson process to represent spare pa...

We consider dynamic pricing and replenishment decisions for a production/inventory system modeled by a make-to-stock queue. The potential customer demand is generated by a MarkovModulated (environment-dependent) Poisson process and the actual demand depends on the price offered at the time of the transaction. Using a Markov Decision Process framework, we obtain results on the structure of the o...