In managing an inventory network, two approaches to the pooling of stock have been proposed. Reactive transshipments respond to shortages at a location by moving inventory from elsewhere within the network, while proactive stock redistribution seeks to minimize the chance of future stockouts. This paper is the first to propose an enhanced reactive approach in which individual transshipments are...

We consider a segment of a supply chain comprising an inventory system and a transportation system that cooperate in the fulfillment of stochastic customer orders. The inventory system is operated under a discrete time (s, q) policy with backorders. In a system of this kind accumulated backorders introduce lumpiness of transportation demand into the system. We study the connection between the s...

Motivated by a recent paper on the effect of lead-time variability reduction on safety stocks, we provide evidence of the recursive nature of safety stock changes. When lead times follow a gamma distribution we demonstrate that, for cycle service levels between .60 and .70, the reduction of lead-time variability will first increase safety stock and then either recursively decrease safety stock ...

This is a summary of the author’s PhD thesis supervised by Philippe Chrétienne and Safia Kedad-Sidhoum and defended in December 2005 at the Université Pierre et Marie Curie (Paris VI). The thesis is written in French and is available from http://absi.nabil.free.fr/ABSI-Thesis.pdf. This work mainly deals with multi-item capacitated lot-sizing problems with setup times, shortages on demand and sa...

As a means of avoiding stock‐outs, safety stocks play an important role in achieving customer satisfaction and retention. However, traditional safety stock theory is based on the assumption of the immediate delivery of the ordered products, which is not a common condition in business‐to‐business contexts. Virtual safety stock theory was conceived to ...

The increasingly uncertain business environment requires the necessity to implement more flexibility in companies. Unfortunately, companies being specialized in engineer-to-order production cannot use safety stocks which are generally used in make-to-stock productions to secure flexibility. Therefore, an alternative approach has to be developed to facilitate procurement flexibility for these co...

Increased reliance upon outsourcing has made the issue of vendor selection even more critical to the success of the modern manufacturing organization. The usual performance measure on which selection is based has been the distribution of the vendor’s delivery lead-time (LT), often as characterized by the mean and variance. In this paper, we show that the distribution of demand per unit time (DP...

An accurate safety stock forecasting model has both academic and practical significance to inventory management. Reliable safety stock forecasting can not only help in making right decision but also in decreasing the cost and thereby increasing the profit significantly. Therefore in this paper, Artificial Neural Network (ANN) along with Clustering techniques, have been applied to predict the sa...

This paper investigates the effects of macroeconomic volatility on non–financial firms’ cash holding behavior. Using an augmented cash buffer–stock model, we demonstrate that an increase in macroeconomic volatility will cause the cross–sectional distribution of firms’ cash–to–asset ratios to narrow. We test this prediction on a panel of non–financial firms drawn from the annual COMPUSTAT databa...