Electronic Companion — “ Asymptotic Optimality of Order - Up - To Policies in Lost Sales Inventory Systems ” by Woonghee

Electronic Companion — “ Inventory Management with Auctions and Other Sales Channels : Optimality of ( s , S ) Policies ” by

Robustness of Order-Up-to Policies in Lost-Sales Inventory Systems

"Robustness of order-up-to policies in lost-sales inventory systems. Full terms and conditions of use:

Asymptotic Optimality of Order-Up-To Replenishment Policies for Serial Inventory Systems with Lost Sales

We study the optimal policy for a serial inventory system under periodic review when excess demand at the retailer (i.e., the most downstream stage) is lost. We focus on “high service level environments” (i.e., systems where the cost of a lost sale is high compared to inventory holding costs). These environments are typical of products whose margins are high relative to their holding costs. Whe...

Asymptotic Optimality of Order-Up-To Policies in Lost Sales Inventory Systems

We study a single-product single-location inventory system under periodic review, where excess demand is lost and the replenishment lead time is positive. The performance measure of interest is the long run average holding cost and lost sales penalty. For a large class of demand distributions, we show that when the lost sales penalty becomes large compared to the holding cost, the relative diff...

Inventory Management with Auctions and Other Sales Channels: Optimality

We study periodic-review inventory replenishment problems with fixed ordering costs, and show the optimality of (s, S) inventory replenishment policies. Inventory replenishment is instantaneous, i.e., the lead time is zero. We consider several sales mechanisms, e.g., auction mechanisms, name-your-own-price mechanisms, and multiple heterogeneous sales channels. We prove this result by showing th...