A queueing model for time-dependent rental systems with phase-type distributed rentals and substitutions of items

Anders Reenberg Andersen ()
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Anders Reenberg Andersen: Technical University of Denmark

Annals of Operations Research, 2025, vol. 350, issue 3, No 9, 1143-1167

Abstract: Abstract Society currently experiences a growing interest in renting as an alternative to exclusive ownership (Fota et al., 2019; Yeganeh, 2021). This paper supports rental companies in this transition by providing a method to evaluate rental system occupancy. The method considers time-dependent systems in which customers rent substitutes during stockouts. Specifically, the paper provides a queueing model based on a continuous-time Markov chain for systems where rentals occur according to Poisson processes and rental times follow phase-type distributions. Additionally, the paper provides a heuristic optimization algorithm to minimize inventory capacity while maintaining an upper stockout probability limit. The paper evaluates these methods through numerical experiments, including a company case. The results indicate that the queueing model adequately reflects the occupancy distributions of the investigated items, and that the optimization algorithm minimizes the inventory capacity to near-optimality. In the company case, these methods reduce the inventory capacity while simultaneously improving the maximum stockout probability.

Keywords: Queueing; Markov chain; Phase-type; Rental (search for similar items in EconPapers)
Date: 2025
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DOI: 10.1007/s10479-025-06645-1

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