Multicriteria Trade-Offs in a Warehouse/Retailer System

James H. Bookbinder · Vincent Y. X. Chen

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Supply Chain and Inventory Management Multi-Criteria Decision Making Optimization and Mathematical Programming

Abstract

Multiple Criteria Decision Making (MCDM) methodology is applied to a two-echelon serial inventory/distribution system, consisting of a warehouse and retailer. Different situations, such as deterministic and probabilistic demand, and whether marginal inventory costs are known, are discussed. Three non-linear multiobjective programming models and corresponding solution approaches are presented to obtain non-dominated inventory policies achieving trade-offs among objectives such as customer service, inventory investment and transportation cost. Our results are MCDM generalizations of Brown's exchange curve, Starr and Miller's optimal policy curve and Gardner and Dannenbring's optimal policy surface.

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References

1964Analysis of Inventory Systems.1979Decision Systems for Inventory Management and Production Planning 2004Optimal Policies for a Multi-Echelon Inventory Problem 1981Multi-level production/inventory control systems : theory and practice 1964The art of simulation 1968Decision Rules for Inventory Management 1973Economic Lot Size Determination in Multi-Stage Assembly Systems 1988Estimating the Performance of Multi-Level Inventory Systems

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2015Cost-service tradeoff analysis of reorder-point-lot-size inventory models 2015Multi-objective optimization of a mixture inventory system using a MOPSO–TOPSIS hybrid approach 2013Developing and solving two-echelon inventory system for perishable items in a supply chain: case study (Mashhad Behrouz Company)

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