Inventory control policy of preventive lateral transshipment between retailers in multi periods

Journal of Industrial Engineering and Management

卷:7

Bin Dan¹  Qing Ren He¹  Ru Liu¹ 

[1] School of Economics & Business Administration of Chongqing University and Key Laboratory of Logistics at Chongqing University;

关键词: preventive lateral transshipment, the transship-up-to level, the transship-down-to level, inventory control policy, multi selling periods;   

DOI  :  10.3926/jiem.1068

来源: DOAJ

【 摘 要 】

Purpose: Preventivelateral transshipment can respond to customers who will choose a substitute or to give up when the product is out of stock. Motivatedby the common practice, adecision-making model of preventive lateral transshipment with multi sellingperiods is developed. The purpose of the paper is to explore the optimal preventive lateral transshipment policy with multi selling periods.

Design/methodology/approach: With adiscrete-time dynamic programming model, we take a dynamic programming approach and adopt backward induction to analyze two retailers’ preventive lateral transshipment policy.

Findings: The optimal preventivelateral transshipment policy is a threshold policy which depends on both theremaining selling periods and inventory level. The above properties ensure thattwo retailers can control inventory with preventive lateral transshipment.

Practical implications: The retailer can adjust inventory via the thresholdtype policy. The simple decisionrule which compares on-hand inventory level with the critical inventory level can be used to control inventory by preventive lateral transshipment.

Originality/value: A discrete-timedecision-making model of preventive lateral transshipment policy isformulated. This model takes consideration of multi selling periods, whichis different from most existing researches on preventive lateraltransshipment.

【 授权许可】

Unknown