Can-order policy for the periodic-review joint replenishment problem

S G Johansen () and P Melchiors
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S G Johansen: University of Aarhus
P Melchiors: University of Aarhus

Journal of the Operational Research Society, 2003, vol. 54, issue 3, 283-290

Abstract: Abstract In this paper we study the stochastic joint replenishment problem. We compare the class of periodic replenishment policies and the class of can-order policies for this problem. We present a method, based on Markov decision theory, to calculate near-optimal can-order policies for a periodic-review inventory system. Our numerical study shows that the can-order policy behaves as well as, if not better than, the periodic replenishment policies. In particular, for examples where the demand is irregular, we find cost differences up to 15% in favour of the can-order policy.

Keywords: inventory control; joint replenishment; can-order policy; Markov processes (search for similar items in EconPapers)
Date: 2003
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Citations: View citations in EconPapers (14)

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DOI: 10.1057/palgrave.jors.2601499

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