Inventory rationing and replenishment for an omni-channel retailer

The growth of omni-channel retailing resulted in many new challenges for retailers, especially relation to the replenishment and allocation inventories different channels. In this paper we consider a brick-and-mortar store that uses its inventory fulfil both in-store demand as well online orders. addition deciding on quantities, such retailer also has decide how ration across Practically, rationing relates storing part backroom satisfy demand. process occurs regularly (e.g. daily) whereas typically less regular. To analyse decision process, model ordering decisions Markov Decision Problem maximises expected profit. Based structure optimal policies, determine heuristics near-optimal results scale retailers with products.