The Effect of Commonality on Safety Stock in a Simple Inventory Model

Kenneth R. Baker, Michael J. Magazine and Henry L. W. Nuttle
Additional contact information
Kenneth R. Baker: The Amos Tuck School of Business Administration, Dartmouth College, Hanover, New Hampshire 03755
Michael J. Magazine: Department of Management Sciences, University of Waterloo, Waterloo, Ontario, Canada
Henry L. W. Nuttle: Department of Industrial Engineering, North Carolina State University, Raleigh, North Carolina 27695

Management Science, 1986, vol. 32, issue 8, 982-988

Abstract: We examine the effects of component commonality on optimal safety stock levels in a two-product, two-level inventory model. The criterion is to minimize system safety stock subject to a service level constraint. Although our model is specialized, its analysis provides insights not available in other multilevel inventory models.

Keywords: inventory/production; measures of effectiveness; multi-echelon (search for similar items in EconPapers)
Date: 1986
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Citations: View citations in EconPapers (74)

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Persistent link: https://EconPapers.repec.org/RePEc:inm:ormnsc:v:32:y:1986:i:8:p:982-988

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