Power-of-two single-warehouse multi-buyer inventory coordination with private information

Power-of-two inventory theory is used to develop a heuristic for coordinating the inventory system given complete information. In turn, the heuristic is modified to solve the problem under private information. Both heuristics are applicable to systems where the cost functions are convex. In addition, the proposed heuristics are 94% effective if all the facilities adopt the classical EOQ assumptions.