LIFO Inventory Systems

Morris A. Cohen and Dov Pekelman
Additional contact information
Morris A. Cohen: University of Pennsylvania
Dov Pekelman: Tel Aviv University

Management Science, 1978, vol. 24, issue 11, 1150-1162

Abstract: In many perishable product inventory systems where the issuing of stock to meet demand is controlled by the consumer, the movement of units through the system obeys a LIFO discipline. In this paper the evolution over time of the LIFO inventory stock age distribution in an environment of stochastic demand is analyzed. The inventory related processes are shown to be completely specified by the random walk ladder height process. This characterization of the LIFO system is then utilized to derive limiting distributions for the stock age distribution when a constant amount is ordered each period. The distribution is found from a Wiener-Hopf integral equation for the ladder height random variable. Transient results for the case of a fixed critical number order policy are also presented. Explicit closed form results are derived for an example in which demand is exponentially distributed. The paper concludes by demonstrating how the results on the steady-state age distribution can be used for devising upper and lower bounds on expected shortages and outdates.

Date: 1978
References: Add references at CitEc
Citations: View citations in EconPapers (12)

Downloads: (external link)
http://dx.doi.org/10.1287/mnsc.24.11.1150 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:inm:ormnsc:v:24:y:1978:i:11:p:1150-1162

Access Statistics for this article

More articles in Management Science from INFORMS Contact information at EDIRC.
Bibliographic data for series maintained by Chris Asher ().