We consider a system in which an order is placed every T periods to bring the inventory position up to the base stock S. We accept demand until the inventory position reaches a sales rejection threshold M. Our objective is to find the optimal values of S and M which minimize the long-run average cost per period. We establish the stationary distribution of our system and develop structural prope...

This paper presents a periodic review capacitated lot sizing model with limited backlogging and a possibility of emergency orders. The main intention of placing emergency orders is to satisfy the demand as soon as a shortage occurs. It is assumed that the demands are independently distributed in successive periods. There are two resupply modes available: a regular mode and an emergency mode. He...

We study the value of component commonality in a periodic review assemble-to-order system, introduced by Akçay and Xu in 2004, where an independent base stock policy and a first-come-first-served allocation rule are used, and the base stock levels and the component allocation are optimized jointly. We show that lowering component commonality may yield a higher type-II service level. The lower d...

ABSTRACT: We consider a periodic review inventory system for perishable items with lost sales. Demands arrive according to a Poisson process. The lifetime of each item is exponentially distributed and the procurement lead time is constant. This type of modeling is motivated by the recent application of the so called Time Temperature Technologies. With this technology, it is possible to detect a...