Exponential smoothing is often used to forecast lead-time demand for inventory control. In this paper, formulae are provided for calculating means and variances of lead-time demand for a wide variety of exponential smoothing methods. A feature of many of the formulae is that variances, as well as the means, depend on trends and seasonal effects. Thus, these formulae provide the opportunity to i...

I this paper we study how the time-series structure of the demand process affects the value of information sharing in a supply chain. We consider a two-stage supply chain model in which a retailer serves autoregressive moving-average (ARMA) demand and a manufacturer fills the retailer’s orders. We characterize three types of situations based on the parameters of the demand process: (i) the manu...

Most research on order splitting have focused on the reduction of safety stock in the multiple sourcing setting. Moreover, all works study the use of order splitting for the continuous review inventory systems. In this paper, we investigate the possibility of the multiple-delivery arrangement in the sole sourcing environment. In addition, we concentrate on the reduction of cycle stock for perio...

In today’s business environment, the dynamics of the business drive many decisions in the supply chain. Companies will buffer inventory, carry excess capacity and headcount, and have costly marketing initiatives in order to handle the dynamics of the business. In order to better analyze the business dynamics and define supply chains that are robust to changes in the business environment, Compaq...

We develop bounds and approximations for setting base-stock levels in production-inventory systems with limited production capacity. Our approximations become exact as inventories become critical, meaning either that the target service level is very high or the backorder penalty is very large. Our bounds apply even without this requirement. We consider both single-stage and multi-stage systems....

We investigate large-scale facility location models that consider the risk pooling effects of centralizing safety stocks when customer demands are correlated across customer locations. This problem has not been well studied, perhaps because the calculation of safety stock levels with correlated demands requires significant computational effort. The experimental evaluation of any proposed proced...

Manufacturing managers face increasing pressure to reduce inventories across the supply chain. However, in complex supply chains, it is not always obviouswhere to hold safety stock to minimize inventory costs and provide a high level of service to the final customer. In this paper we develop a framework for modeling strategic safety stock in a supply chain that is subject to demand or forecast ...

Inventory model under risk that demand is uncertain is recognized. In this paper, the fuzzy demand per day and fuzzy lead time on a cycle in fuzzy inventory control system are assumed to trapezoidal distribution, trapezoidal fuzzy number by decision maker. A fuzzy inventory model under manager’s preference for order quantity is presented first. This model is given by fuzzy total annual inventor...

Unit load devices (ULDs) are used to load air cargo and passengers’ checked baggage for wide-bodied aircraft operations. Since ULDs are reusable at the destination, airlines can invest in an appropriate fleet size for their requirements. The estimation of safety stock levels for every operating airport is a premeditated task because airlines must prepare enough devices for the outbound consignm...

This article examines the optimal stock-out risk for a component used by alternative modules mounted on several assembly lines. The studied context is a supply chain dedicated to the mass production of highly diversified products, which is common in the automotive industry. The material requirement planning (MRP) approach is adapted to monitor this chain; however, the distance between the produ...