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

Estimation of the cost function of a two-echelon inventory system with lost sales using regression

Multi-echelon inventory systems are one of the most important and attractive areas in modelling supply chain management so that several researches and studies have been done about. In this paper, the total cost function of a two-echelon inventory system with central warehouse and many identical retailers controlled by continuous review inventory policy is estimated. We have assumed the demand i...

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

A 2-Approximation Algorithm for Stochastic Inventory Control Models with Lost Sales

In this paper, we describe the first computationally efficient policies for stochastic inventory models with lost sales and replenishment lead times that admit worst-case performance guarantees. In particular, we introduce dual-balancing policies for lost-sales models that are conceptually similar to dual-balancing policies recently introduced for a broad class of inventory models in which dema...

Lost-Sales Problems with Stochastic Lead Times: Convexity Results for Base-Stock Policies

We consider a single-location inventory system with periodic review and stochastic demand. It places replenishment orders to raise the inventory position—that is, inventory on hand plus inventory in transit—to exactly S at the beginning of every period. The lead time associated with each of these orders is random. However, the lead-time process is such that these orders do not cross. Demand tha...

Optimal Policies for Inventory Systems with Concave Ordering Costs

In this paper we characterize the structure of optimal policies for periodic review inventory systems with concave ordering costs. By extending the Scarf (1958) model to systems with piecewise linear concave ordering costs, we show the optimality of generalized (s, S) policies for general demand distributions. We do so by (a) introducing a conditional monotonicity property for the order-up-to l...