 Analysis of order-up-to-level inventory systems with compound Poisson demandZied Jemai (),
M. Babai () and
Y. Dallery
Post-Print from HAL Abstract: We analyse a single echelon single item inventory system where the demand and the lead time are sto-chastic. Demand is modelled as a compound Poisson process and the stock is controlled according to a continuous time order-up-to (OUT) level policy. We propose a method for determining the optimal OUT level for cost oriented inventory systems where unfilled demands are backordered. We first establish an analytical characterization of the optimal OUT level. The actual calculation is based on a numerical procedure the accuracy of which can be set as highly as desired. By means of a numerical investigation, we show that the method is very efficient in calculating the optimal OUT level. We compare our results with those obtained using an approximation proposed in the literature and we show that there is a significant difference in accuracy for slow moving items. Our work allows insights to be gained on stock control related issues for both fast and slow moving Stock Keeping Units (SKUs). Keywords: Stock control; Compound Poisson; Queuing system; Order-up-to-level; Slow moving items (search for similar items in EconPapers) Published in European Journal of Operational Research, 2011, 210 (3), pp.552 - 558. ⟨10.1016/j.ejor.2010.10.004⟩ There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it. Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-01672399 DOI: 10.1016/j.ejor.2010.10.004 Access Statistics for this paper More papers in Post-Print from HAL |
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