Service Parts Inventory Control with Lateral Transshipment that Takes Time

In equipment-intensive industries such as truck manufacturing, electronics manufacturing, photo copiers, and airliners, service parts are often slow moving items for which, in some cases, the transshipment time is not negligible. However, this aspect is hardly considered in the existing spare parts literature. We assess the effect of non-negligible lateral transshipment time on various aspects of spare parts inventory control. Furthermore, we introduce customer-oriented service levels by taking the uncommitted pipeline stocks into account. A case study in the dredging industry shows that lateral transshipment may lead to lower system performance, which supports the results from some recent studies. Furthermore, we find that considerable savings can be obtained when we include the uncommitted pipeline stocks in both base stock allocation and lateral transshipment decisions.inventory control;METRIC;customer-oriented service level;lateral transshipment

Leader-follower Game in VMI System with Limited Production Capacity Considering Wholesale and Retail Prices

VMI (Vendor Managed Inventory) is a widely used cooperative inventory policy in supply chains in which each enterprise has its autonomy in pricing. This paper discusses a leader-follower Stackelberg game in a VMI supply chain where the manufacturer, as a leader, produces a single product with a limited production capacity and delivers it at a wholesale price to multiple different retailers, as the followers, who then sell the product in dispersed and independent markets at retail prices. An algorithm is then developed to determine the equilibrium of the Stackelberg game. Finally, a numerical study is conducted to understand the influence of the Stackelberg equilibrium and market related parameters on the profits of the manufacturer and its retailers. Through the numerical example, our research demonstrates that: (a) the market related parameters have significant influence on the manufacturer’ and its retailers’ profits; (b) a retailer’s profit may not be necessarily lowered when it is charged with a higher inventory cost by the manufacturer; (c) the equilibrium of the Stackelberg equilibrium benefits the manufacturer.Stackelberg Game;Supply Chain;Vendor Managed Inventory

Reinforcement Learning Algorithms and Complexity of Inventory Control, A Review

Driven by the ability to perform sequential decision-making in complex dynamic situations, Reinforcement Learning (RL) has quickly become a promising avenue to solve inventory control (IC) problems. The objective of this paper is to provide a comprehensive overview of the IC problems that have been effectively solved due to the application of RL. Our contributions include providing the first systematic review in this field of interest and application. We also identify potential extensions and come up with four propositions that formulate a theoretical framework that may help develop RL algorithms to solve complex IC problems. We recommend specific future research directions and novel approaches in solving IC problems

Supply Chain Management and Management Science: A Successful Marriage

The last century has witnessed extant studies on the applications of Management Science (MS) to a diverse set of Supply Chain Management (SCM) issues. This paper provides an overview of the contribution of MS within SCM. A framework is developed in this paper with a sampling of MS contributions to major SCM dimensions. Future research directions are presented

A single-producer multi-retailer integrated inventory model with a rework process

This study considers a single-producer multi-retailer integrated inventory model with the reworking of random defective items produced. The objective is to find the optimal production lot size and optimal number of shipments that minimizes total expected costs for such a specific supply chains system. It is assumed that a product is manufactured by a producer. All items are screened for quality purpose and random nonconforming items will be picked up and reworked at the end of regular production in each cycle. After the entire lot is quality assured, multiple shipments will be delivered synchronously to m different retailers in each production cycle. Each retailer has its own annual product demand, unit stock holding cost, and fixed and variable delivery costs. Mathematical modeling and analysis is used to deal with the proposed model and to derive the expected system cost. Hessian matrix equations are employed to prove the convexity of the cost function. As a result, a closed-form optimal replenishment-delivery policy for such a specific single-producer multi-retailer integrated inventory model is obtained. A numerical example is provided to show the practical usage of the proposed model

Supply Chain Management in the Life Science Sector: Does Trust Play a Role?

Supply chain management has emerged as cross functional, cross company concept to improve coordination of entire value chains through coordinated actions of all companies in the value chain. It has received a major push from the availability of Internet-based information and communication technologies. The conditions in certain sectors are favorable for a realization of chain wide supply chain management. In other sectors, however, conditions are more complex and companies and value chains still struggle to exploit the potentials from supply chain management, in particular when it comes to cross enterprise coordination. This paper takes a complex supply network as example and discusses improvement potentials from supply chain management and developments in their implementation as well as barriers to the realization of chain wide supply chain management.supply chain management, trust, life science sector, Agribusiness, Industrial Organization,