Computing the non-stationary replenishment cycle inventory policy under stochastic supplier lead-times

R. Rossi, S.A. Tarim, B. Hnich, S. Prestwich

Research output: Contribution to journalArticleAcademicpeer-review

30 Citations (Scopus)

Abstract

In this paper we address the general multi-period production/inventory problem with non-stationary stochastic demand and supplier lead-time under service level constraints. A replenishment cycle policy (Rn,Sn) is modeled, where Rn is the nth replenishment cycle length and Sn is the respective order-up-to-level. We propose a stochastic constraint programming approach for computing the optimal policy parameters. In order to do so, a dedicated global chance-constraint and the respective filtering algorithm that enforce the required service level are presented. Our numerical examples show that a stochastic supplier lead-time significantly affects policy parameters with respect to the case in which the lead-time is assumed to be deterministic or absent
Original languageEnglish
Pages (from-to)180-189
JournalInternational Journal of Production Economics
Volume127
Issue number1
DOIs
Publication statusPublished - 2010

Keywords

  • service-level constraints
  • lot-sizing problem
  • systems
  • demand
  • model

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