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An ( s , q ) inventory model with stochastic and interrelated lead times
Author(s) -
Heuts Ruud,
de Klein Jan
Publication year - 1995
Publication title -
naval research logistics (nrl)
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.665
H-Index - 68
eISSN - 1520-6750
pISSN - 0894-069X
DOI - 10.1002/1520-6750(199508)42:5<839::aid-nav3220420509>3.0.co;2-8
Subject(s) - allowance (engineering) , lead time , function (biology) , order (exchange) , mathematical optimization , constant (computer programming) , economic order quantity , integer (computer science) , computer science , mathematics , economics , operations management , supply chain , finance , evolutionary biology , political science , law , biology , programming language
In this article we introduce a lead time mechanism that allows simultaneous order arrivals. This mechanism ensures that orders never cross each other. For the continuous review (s, q) inventory system with constant demand, we show that the allowance of batch arrivals gives rise to a discontinuous cost function. By exploiting the special structure of this cost function, a search algorithm is derived that yields the optimal order strategy in a reasonable amount of time. The search is restricted to integer order strategies only. We also consider an approximate method of solution that is based on a related model with a continuous cost function. The results obtained by this approximation are, in general, very satisfactory. © 1995 John Wiley & Sons, Inc.