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| Author: | Melchiors, P. |
| Title: | Calculating can-order policies for the joint replenishment problem by the compensation approach |
| Journal: | European Journal of Operational Research
2002 : SEP, VOL. 141:3, p. 587-595 |
| Index terms: | INVENTORIES DECISION MAKING DECISION MODELS PROBLEM FORMULATION PROBLEM SOLVING |
| Language: | eng |
| Abstract: | In this paper the authors consider the stochastic joint replenishment problem. The authors coordinate the replenishment of an inventory with several items, where the fixed cost of replenishment consists of a major order cost for each order and a minor order cost for each item participating in the order. The literature has focused on two kinds of policies: can-order policies and periodic replenishment policies. Generally speaking the can-order policy performs better when the major ordering cost is relatively low, and the periodic replenishment policies better when the major ordering cost is relatively high. The authors present a new method for calculating can- order policies, which dominates existing methods on examples where the can-order policy performs better than the periodic replenishment policies. |
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