Simple, efficient heuristics for multi-item multi-location spare parts systems with lateral transshipments and waiting time constraints

H Wong (), G J van Houtum, D Cattrysse and D Van Oudheusden
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H Wong: Katholieke Universiteit Leuven, Celestijnenlaan
G J van Houtum: Technische Universiteit Eindhoven
D Cattrysse: Katholieke Universiteit Leuven, Celestijnenlaan
D Van Oudheusden: Katholieke Universiteit Leuven, Celestijnenlaan

Journal of the Operational Research Society, 2005, vol. 56, issue 12, 1419-1430

Abstract: Abstract This paper deals with the analysis of a multi-item, continuous review model of a multi-location inventory system of repairable spare parts, in which lateral and emergency shipments occur in response of stock-outs. The objective is to determine close-to-optimal stocking policies minimizing the total cost for inventory holding, lateral transshipments, and emergency shipments subject to a target level for the average waiting times at all locations. We structure the optimization problem as a combinatorial problem and four different heuristics are developed and evaluated in terms of their total costs and computation times. It is shown that the greedy-type heuristic has the best performance. A numerical study is carried out to look at the relative cost savings obtained from the use of multi-item approach and lateral transshipments.

Keywords: inventory; spare parts; multi-item; lateral transshipment; heuristic (search for similar items in EconPapers)
Date: 2005
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Citations: View citations in EconPapers (15)

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DOI: 10.1057/palgrave.jors.2601952

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