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An Efficient and Robust Design for Transshipment Networks
Author(s) -
Lien Robert W.,
Iravani Seyed M. R.,
Smilowitz Karen,
Tzur Michal
Publication year - 2011
Publication title -
production and operations management
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 3.279
H-Index - 110
eISSN - 1937-5956
pISSN - 1059-1478
DOI - 10.1111/j.1937-5956.2010.01198.x
Subject(s) - transshipment (information security) , supply chain , computer science , robustness (evolution) , mathematical optimization , operations research , business , mathematics , marketing , computer security , biochemistry , chemistry , gene
Transshipment, the sharing of inventory among parties at the same echelon level of a supply chain, can be used to reduce costs. The effectiveness of transshipment is in part determined by the configuration of the transshipment network. We introduce chain configurations in transshipment settings, where every party is linked in one connected loop. Under simplifying assumptions we show analytically that the chain configuration is superior to configurations suggested in the literature. In addition, we demonstrate the efficiency and robustness of chain configurations for more general scenarios and provide managerial insights regarding preferred configurations for different problem parameters.