Crossover aware base stock decisions for service-driven systems

Dean C. Chatfield and Alan M. Pritchard

Transportation Research Part E: Logistics and Transportation Review, 2018, vol. 114, issue C, 312-330

Abstract: We investigate the impact of order crossover on a periodic, order-up-to (R,S) inventory system where attaining a target service level is the focus. We first address two crossover related assumptions and then explore five methods of including crossover information into the process of determining the order-up-to level (S). We develop a hybrid discrete-event/continuous simulation model and perform a full-factorial simulation study under various conditions of target service level, demand variance, and lead-time variance. We find the method used to include crossover information into the decision significantly impacts service performance and that methods based on effective lead-time observations perform best.

Keywords: Order crossover; Simulation; Inventory; Service level; Amazon effect; Lead time (search for similar items in EconPapers)
Date: 2018
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Citations: View citations in EconPapers (4)

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DOI: 10.1016/j.tre.2017.12.013

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