A lost sales inventory model with a compound poisson demand pattern.

Sales; Inventory; Model; Demand; University; Research;

Determining The Optimal Order Picking Batch Size In Single Aisle Warehouses

This work aims at investigating the influence of picking batch size to average time in system of orders in a one-aisle warehouse under the assumption that order arrivals follow a Poisson process and items are uniformly distributed over the aisle's length. We model this problem as an M/G[k]/1 queue in which orders are served in batches of exactly orders. The average time in system of the M/G[k]/1 queue is difficult to obtain for general service times. To circumvent this obstacle, we perform an extensive numerical experiment on the average time in system of the model when the service time is deterministic (M/D[k]/1) or exponentially distributed (M/M[k]/1). These results are then compared with the corresponding times in system of the actual model taken from simulation runs. A variance analysis is carried out and its result elicits that the M/D/[k]/1 queue is a very good approximation for the average time in system of orders. Correspondingly, the optimal picking batch size of the real system ca

Dynamic routing and service network design for less-than-truckload (LTL) motor carriers

This research tries to address the dynamic priority shipment routing problem and dynamic service network design problem for the less-than-truckload (LTL) carriers. First, described is a decision support tool to assist LTL managers in studying, analyzing and planning LTL operations so that scarce resources are used more effectively and efficiently. The decision support tool helps to understand the complicated interactions between the shipment route, closing rules, cost, and service level. Numerical experiments are done using the decision support tool to analyze the existing rules of LTL carriers and to understand their effect on the total cost of the system and the service level provided;Currently, LTL carriers route both regular and priority shipments through their service networks using some fixed route patterns known as load plans. In this research, an alternative routing strategy for routing priority shipments in LTL networks is proposed. This strategy exploits the stochasticity and dynamism embedded in the routing process and utilizes the real time information about terminals to determine the shipment routes adaptively. The research shows that this strategy can be formulated as the problem of finding a dynamic shortest path problem over a network with random arc costs. An efficient algorithm is developed that can solve this optimization problem in real-time. Numerical testing using real data sets suggests that the proposed strategy can improve the level of service for priority shipments;LTL carriers currently use ad hoc rules in deciding when there is enough capacity to close a trailer. In order to reduce the fixed and penalty costs incurred by the LTL carriers and to increase the service level provided by LTL carriers to customers, the decision should be optimized over time. In other words, the decision to dispatch a trailer should not only depend on the current shipment level, but should also vary dynamically based on time of day, day of the week, and seasonal effects. A dynamic control policy for dispatching a trailer over a single link is proposed in this research. This research provides an approach to estimate the shape of the recourse function. The dynamic control policy exploits the linearity of the recourse function estimated in solving the trailer dispatching problem efficiently. The algorithm is easy to implement and computationally fast and hence can be extended to solve large LTL networks. Experiments with the dynamic control policy show that the solutions obtained are very close to the optimal

Statistical process control applied to rail freight terminal performance : a case study of CSX's Radnor yard

Thesis (M.S.)--Massachusetts Institute of Technology, Dept. of Civil and Environmental Engineering, 1994.Includes bibliographical references (leaves 88-93).by Michael A. Duffy, Jr.M.S

ANALYSIS OF SHIPMENT CONSOLIDATION IN THE LOGISTICS SUPPLY CHAIN

Shipment Consolidation (SCL) is a logistics strategy that combines two or more orders or shipments so that a larger quantity can be dispatched on the same vehicle to the same market region. This dissertation aims to emphasize the importance and substantial cost saving opportunities that come with SCL in a logistics supply chain, by offering new models or by improving on the current body of literature. Our research revolves around "three main axes" in SCL: Single-Item Shipment Consolidation (SISCL), Multi-Item Shipment Consolidation (MISCL), and Pricing and Shipment Consolidation. We investigate those topics by employing various Operations Research concepts or techniques such as renewal theory, dynamic optimization, and simulation. In SISCL, we focus on analytical models, when the orders arrive randomly. First, we examine the conditions under which an SCL program enables positive savings. Then, in addition to the current SCL policies used in practice and studied in the literature, i.e. Quantity-Policy (Q-P), Time-Policy (T-P) and Hybrid Policy (H-P), we introduce a new one that we call the Controlled Dispatch Policy (CD-P). Moreover, we provide a cost-based comparison of those policies. We show that the Q-P yields the lowest cost per order amongst the others, yet with the highest randomness in dispatch times. On the other hand, we also show that, between the service-level dependent policies (i.e. the CD-P, H-P and T-P), H-P provides the lowest cost per order, while CD-P turns out to be more flexible and responsive to dispatch times, again with a lower cost than the T-P. In MISCL, we construct dispatch decision rules. We employ a myopic analysis, and show that it is optimal, when costs and the order-arrival processes are dependent on the type of items. In a dynamic setting, we apply the concept of time-varying probability to integrate the dispatching and load planning decisions. For the most common dispatch objectives such as cost per order, cost per unit time or cost per unit weight, we use simulation and observe that the variabilities in both cost and the optimal consolidation cycle are smaller for the objective of cost per unit weight. Finally on our third axis, we study the joint optimization of pricing and time-based SCL policy. We do this for a price- and time-sensitive logistics market, both for common carriage (transport by a public, for-hire trucking company) and private carriage (employing one's own fleet of trucks). The main motivation for introducing pricing in SCL decisions stems from the fact that transportation is a service, and naturally demand is affected by price. Suitable pricing decisions may influence the order-arrival rates, enabling extra savings. Those savings emanate from two sources: Scale economies (in private carriage) or discount economies (in common carriage) that come with SCL, and additional revenue generated by employing an appropriate pricing scheme. Throughout the dissertation, we offer numerical examples and as many managerial insights as possible. Suggestions for future research are offered

The transporter's impact on channel coordination and contractual agreements

This dissertation focuses on the recent supply chain initiatives, such as Vendor Managed Inventory (VMI) and Third-Party Logistics (3PL), enabling the coordination of supply chain entities; e.g., suppliers, buyers, and transporters. With these initiatives, substantial savings are realizable by carefully coordinating inventory, transportation, and pricing decisions. The impact is particularly tangible when the transporter's role and the transportation costs are explicitly incorporated into decision mechanisms that aim to coordinate the supply channel. Furthermore, expanding the perspective of channel coordination by introducing the transporter as an individual party in the channel provides tangible benefits for each member of the channel. Recognizing the need for further analytical research in the field of multi-echelon inventory and channel coordination, we developed and solved a class of integrated inventory and transportation models with explicit shipment consolidation considerations. Moreover, we examined transporter-buyer and supplier-transporter-buyer channels and solved centralized and decentralized models for these channels with the aim of investigating the impact of transporters on channel performance. In this dissertation, we also developed efficient coordination mechanisms between the transporter and the other parties in the channel

Slow Logistics – eine simulationsgestützte Analyse der ökonomischen und ökologischen Potentiale der Sendungsbündelung

Next Day, Next Morning, Same Day, Same Hour – customers are getting their orders faster and faster. Today high speed delivery based on accelerated logistical processes is a key competitive factor in distribution logistic, not only in the B2C-Sector. This speed, however, necessitate high use and waste of resources. It thus counteracts current efforts towards more sustainability in value-added processes. It also raises the question of whether speed or rather delivery reliability and sustainable using of resources will be the decisive criteria for customers in the future. Slow Logistics bears on these arguments. This concept breaks with the paradigm of speed in logistics without, however, impairing the economic efficiency. On the contrary, the conscious exploitation of existing time windows in logistical processes in product-specific supply chains combines the economic and social-ecological value added, so that robust systems will be created based on the accepted slowdown. This dissertation developed as first the theoretically fundament of Slow Logistics and describes detailed possible practical implementations. In addition, this book focuses on shipment consolidation as a central method of slow logistics. A comprehensive simulation study evaluate and analysis different strategies in the field of shipment consolidation to close some major research gaps and thereby generating valuable results and recommendations for implementations in business practice