Estimating a retailer's base stock level: an optimal distribution center order forecast policy

B D Williams and M A Waller
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B D Williams: Auburn University
M A Waller: University of Arkansas

Journal of the Operational Research Society, 2011, vol. 62, issue 4, 662-666

Abstract: Abstract Errors in order forecasts are a salient source of inefficiencies in retail supply chains. Many operational decisions made by suppliers hinge on order forecasts, which typically are based solely on either order or point-of-sale (POS) history. Using a discrete-time formulation, this research demonstrates that if a supplier knows that a retailer is using a base stock policy, it should use that knowledge to forecast the retailer's orders, even if the supplier does not know the base stock level and/or have access to POS data.

Keywords: forecasting; supply chain management; retailing; base stock policy (search for similar items in EconPapers)
Date: 2011
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DOI: 10.1057/jors.2010.55

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