A continuous‐review inventory system with lost sales and variable lead time

Esmail Mohebbi and Morton J.M. Posner

Naval Research Logistics (NRL), 1998, vol. 45, issue 3, 259-278

Abstract: Using a system‐point (SP) method of level crossings, we derive the stationary distribution of the inventory level (stock on hand) in a continuous‐review inventory system with compound Poisson demand, Erlang as well as hyperexponentially distributed lead times, and lost sales. This distribution is then used to formulate long‐run average cost functions with/without a service level constraint. Some numerical results are also presented, and compared with the Hadley and Whitin heuristic. © 1998 John Wiley & Sons, Inc. Naval Research Logistics 45: 259–278, 1998

Date: 1998
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https://doi.org/10.1002/(SICI)1520-6750(199804)45:33.0.CO;2-6

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Persistent link: https://EconPapers.repec.org/RePEc:wly:navres:v:45:y:1998:i:3:p:259-278

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