Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
5470817 | Applied Mathematical Modelling | 2017 | 43 Pages |
Abstract
The inventory control of substitutable products has been recognized as a problem worthy of study in the operations management literature. Product substitution provides flexibility in supply chain management and enhances response time in production control. This paper proposes a finite horizon inventory control problem for two substitutable products, which are ordered jointly in each replenishment epoch. Demand for the products are assumed to be time-varying. In case of a stock-out for one of the products, its demand is satisfied by using the stock of the other product. The optimal ordering schedule, for both products, that minimizes the total cost over a finite planning horizon is derived. Numerical examples along with sensitivity analyses are also presented.
Related Topics
Physical Sciences and Engineering
Engineering
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Authors
Lakdere Benkherouf, Konstantina Skouri, Ioannis Konstantaras,