| Author: | Fotopoulos, S. Wang, M-C. Rao, S. S. |
| Title: | Safety stock determination with correlated demands and arbitrary lead times. |
| Journal: | European Journal of Operational Research
1988 : MAY, VOL. 35:2, p. 172-181 |
| Index terms: | INVENTORY CONTROL SAFETY STOCK CONTROL |
| Language: | eng |
| Abstract: | A new method is proposed for determining the safety stock when daily demands are autocorrelated and lead times follow an arbitrary distribution. The method is used as a basis for examining effects on the safety stock when usual assumptions, namely, independence and normality of daily demand and normality of lead times are violated. The new method is derived by using inequalities on the basis of probability arguments. It is simple to use and provides an upper bound of the safety stock. Autocorrelation is proved to be significant in test cases. |
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