A Note on Stock Replenishment and Shipment Scheduling for Vendor-Managed Inventory Systems

Sven Axsäter

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Supply Chain and Inventory Management Scheduling and Optimization Algorithms Logistics and Transportation Systems

Abstract

In a recent paper, Cetinkaya and Lee (2000) model integrated inventory control and shipment scheduling in connection with vendor-managed inventory (VMI). The model is optimized by an approximate technique. This note provides a simple procedure for exact optimization, and illustrates that the errors when using the suggested approximate technique may be very large for certain types of problems. We also suggest a new approximation and an adjustment that can be used to improve both the original and new heuristic.

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References

2000Stock Replenishment and Shipment Scheduling for Vendor-Managed Inventory Systems 1991Finding Optimal (s, S) Policies Is About As Simple As Evaluating a Single Policy 2000Inventory Control

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2008A stochastic model for joint inventory and outbound shipment decisions 2005Coordination of Inventory and Shipment Consolidation Decisions: A Review of Premises, Models, and Justification 2007Framework for characterizing the design of VMI systems 2010A Reinforcement Learning Approach for Inventory Replenishment in Vendor-Managed Inventory Systems With Consignment Inventory 2005Integrated Inventory Replenishment and Temporal Shipment Consolidation: A Comparison of Quantity-Based and Time-Based Models 2010Inventory control in a two-level supply chain with risk pooling effect 2011Inventory control in divergent supply chains with time‐based dispatching and shipment consolidation 2016Exact Analysis of Divergent Inventory Systems with Time-Based Shipment Consolidation and Compound Poisson Demand

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