The purchasing policy of spare parts for maintenance and the reverse inventory chain logistics has been attracting researcher’s attention in recent years. In spare parts (SP) inventory control the aim is to maintain the inventory at an optimal level and to minimize the purchasing and the inventory costs. This paper deals with integration of the recycled spare parts in the economic models of inv...

This article considers five cost-rate models for inventory control, each summarizing the expected holding and shortage costs per period as a function of the inventory position. All models have linear holding costs and shortage cost coefficients of dimension [$/unit/period], [$/unit] and [$/period]. The latter two coefficients may be the shadow costs of a fill-rate and a ready-rate service const...

The consolidation of Distribution Centers (DCs) is a new trend in global logistics management, with a reduction in inventory costs often being cited as one of the main bene®ts. This paper uses an analytical modeling approach to study the impact on facility investment and inventory costs when several DCs are consolidated into a central DC. In particular, our model suggests that consolidation lea...

In this paper, we describe research to improve Frito-Lay’s outbound supply chain activities by simultaneously optimizing its inventory and transportation decisions. Motivated by Frito-Lay’s practice, we first develop a mixed-integer programming formulation from which we develop a large-scale, integrated multiproduct inventory lot-sizing and vehicle-routing model with explicit (1) inventory hold...

We develop a model to determine the optimal structure and size of a rail car fleet at a chemical company under uncertainty in demand and travel times as well as substitution between rail car types. First, we formulate an MILP model that accounts for the substitution relations between the types and minimizes the total direct rail car cost under given rail car availability constraints and a prede...

In this article we propose, for any > 0, a 2(1 + )-approximation algorithm for a facility location problem with stochastic demands. This problem can be described as follows. There are a number of locations, where facilities may be opened and a number of demand points, where requests for items arise at random. The requests are sent to open facilities. At the open facilities, inventory is kept su...

Motivated by the widespread adoption of dynamic pricing in industry and the empirical evidence of costly price adjustments, in this paper we consider a periodic-review inventory model with price adjustment costs that consist of both fixed and variable components. In each period, demand is stochastic and price-dependent. The firm needs to coordinate the pricing and inventory replenishment decisi...

The paper addresses an inventory model of pharmaceutical products where the demand rate of the customers increases with the volume of the initiatives of the sales team. In this model, the deterioration of the product varies depending on on-hand inventory. The volume of sales team initiatives is a control variable. It is dependent on on-hand inventory and vice versa. The profit function of the f...