Using Break Quantities for Tactical Optimisation in Multistage Distribution Systems

Marcel J. Kleijn and Rommert Dekker

No 97-094/4, Tinbergen Institute Discussion Papers from Tinbergen Institute

Abstract: In this chapter we discuss a tactical optimisation problem that arises in a multistage distribution system where customer orders can be delivered from any stockpoint. A simple rule to allocate orders to locations is a break quantity rule, which routes large orders to higher-stage stockpoints and small orders to end-stockpoints. A so-called break quantity determines whether an order is small or large. We present a qualitative discussion on the implications of this rule for the marketing process, and a qualitative and quantitative analysis on the implications for the transportation and inventory costs. Furthermore, wepresent a case study for a company that implemented a break quantity rule. Finally, in the last section the main results are summarised.

Keywords: Distribution systems; inventory; transportation; marketing; break quantity rule (search for similar items in EconPapers)
Date: 1997-09-24
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
https://papers.tinbergen.nl/97094.pdf (application/pdf)

Related works:
Working Paper: Using break quantities for tactical optimisation in multistage distribution systems (1997)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:tin:wpaper:19970094

Access Statistics for this paper

More papers in Tinbergen Institute Discussion Papers from Tinbergen Institute Contact information at EDIRC.
Bibliographic data for series maintained by Tinbergen Office +31 (0)10-4088900 ().