Industrial Engineering

Vendor-Managed Inventory (VMI) has attracted a lot of attention due to its benefits such as fewer stock-outs, higher sales, and lower inventory levels at the retailers. Vendor-Managed Availability (VMA) is an improvement that exploits the advantages beyond VMI. This article analyzes the benefits beyond information sharing and assesses the motivation for the manufacturer (vendor) behind joining such a program.

In this article, we investigate the profitability of remanufacturing option when the manufactured and remanufactured products are segmented to different markets and the production capacity is finite. A single period profit model under substitution is constructed to investigate the system conditions under which remanufacturing is profitable.

This paper is an attempt to develop a generic modeling framework that addresses tactical planning problems of flexible manufacturing systems in a coherent manner. We propose a generic 0-1 mixed integer programming formulation, that integrates batching, loading, and routing problems with their critical aspects related to a system's performance. For this purpose, a thorough analysis is made to determine and relate system components, their attributes, and alternatives together with performance measures specific to tactical ...

We consider an inventory control problem where it is possible to collect some imperfect information on future demand. We refer to such information as imperfect Advance Demand Information (ADI), which may occur in different forms of applications. A simple example is a company that uses sales representatives to market its products, in which case the collection of sales representatives' information as to the number of customers interested in a product can generate an indication about the future sales of that product, hence it constitutes imperfect ADI. Other applications include internet retailing, Vendor Managed Inventory (VMI) applications and Collaborative Planning, Forecasting, and Replenishment (CPFR) environments. We develop a model that incorporates imperfect ADI with ordering decisions. Under our system settings, we show that the optimal policy is of order-up-to type, where the order level is a function of imperfect ADI. We also provide some characterizations of the optimal solution. We develop an expression for the expected cost benefits of imperfect ADI for the myopic problem. Our analytical and empirical findings reveal the conditions under which imperfect ADI is more valuable.

In a city with a population over 6000000, solid waste collection activities require a lot of attention. The resources used for collection and transport, trucks and labor, can be utilized more effectively if waste is transported to the disposal area via transfer stations. The location of transfer stations becomes especially important when the daily average of solid waste to be transferred is around 6 000 tons and disposal areas are at least 30 kilometres away from the metropolitan. A general mathematical programming approach with four stages is proposed to determine the locations of transfer stations. Certain modifications are required for the case considered, all resulting in a model which identifies the trade-off between costs of carrying the waste by different transportation modes. The identification of the trade-off requires the estimation of relative cost values rather than individual costs. On the basis of the results obtained, economic feasibility of different alternatives can be evaluated upon the availability of cost information. The apphcation of the model to istanbul is summarized together with the details of analysis.

This study investigates the stock allocation problems in a two-echelon distribution system which consists of a central warehouse and two identical retailers. We restrict our attention to two-period order cycles where the period lengths are allowed to be different. Shipments from the supplier to the warehouse arrive at the beginning of the order cycle (i.e. at the beginning of the first period). In each order cycle, there are two shipment opportunities from the warehouse to the retailers: at the beginning of the first and the second periods. In each shipment realization a fixed shipment cost is incurred. In each period a random demand is observed at each retailer (which is assumed to follow a normal distribution). The overall two-stage problem is to determine the optimal allocation policies at the beginning of each period, so that the expected two-period inventory holding, shortage and the shipment costs will be minimum. In this work, we characterize the optimal policy for the second period allocation problem as a function of the stock levels of the retailers at the beginning of the second period, and the reserve stock held at the warehouse. Furthermore, we provide sufficient conditions for which realizing an allocation yields inferior expected costs over keeping the reserve stock at the warehouse. A simulation model is employed to find the optimal first period decision parameters.

In this paper, we analyze a periodic review, single-item inventory model under supply uncertainty. The objective is to minimize expected holding and backorder costs over a finite planning horizon under the supply constraints. The uncertainty in supply is modeled using a three-point probability mass function. The supply is either completely available, partially available, or the supply is unavailable. Machine breakdowns, shortages in the capacity of the supplier, strikes, etc., are possible causes of uncertainty in supply. We demonstrate various properties of the expected cost function, and show the optimality of order-up-to type policies using a stochastic dynamic programming formulation. Under the assumption of a Bernoulli-type supply process, in which the supply is either completely available or unavailable, and when the demand is deterministic and dynamic, we provide a newsboy-like formula which explicitly characterizes the optimal order-up-to levels. An algorithm is given that computes the optimal inventory levels over the planning horizon. Extensions and computational analysis are presented for the case where the partial supply availability has positive probability of occurrence.

We consider an inventory control problem where it is possible to collect some imperfect information on future demand. We refer to such information as imperfect Advance Demand Information (ADI), which may occur in different forms of applications. A simple example is a company that uses sales representatives to market its products, in which case the collection of sales representatives' information as to the number of customers interested in a product can generate an indication about the future sales of that product, hence it constitutes imperfect ADI. Other applications include internet retailing, Vendor Managed Inventory (VMI) applications and Collaborative Planning, Forecasting, and Replenishment (CPFR) environments. We develop a model that incorporates imperfect ADI with ordering decisions. Under our system settings, we show that the optimal policy is of order-up-to type, where the order level is a function of imperfect ADI. We also provide some characterizations of the optimal solution. We develop an expression for the expected cost benefits of imperfect ADI for the myopic problem. Our analytical and empirical findings reveal the conditions under which imperfect ADI is more valuable.

Abstract This study considers a supply chain that consists of n retailers, each of them facing a newsvendor problem, and a supplier. Groups of retailers might increase their ex- pected joint proflt by joint ordering and inventory centralization, which means that they give a joint order and allocate this quantity among,themselves to maximize the total proflt after the demands are realized. Furthermore, we assume that the retailers pose some restrictions on the number of items that should be delivered to them. In this situation, we show that the associated cooperative game has a non-empty core. Afterwards, we concentrate on a dynamic situation, where the retailers change their delivery restrictions. We investigate how the proflt division might be afiected by these changes. We deflne four new monotonicity properties, which we think are interesting in general, and we derive necessary and su‐cient conditions for pairs of totally balanced TU-games to satisfy these properties. We also show...