Inventory allocation and shipping when demand temporarily exceeds production capacity
► We study inventory allocation and shipping for a producer with limited capacity. ► We consider a manufacturer competing with other retailers to sell items. ► We identify the optimal inventory allocation strategy for a manufacturer. We address the concept of an integrated inventory allocation and s...
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Published in | European journal of operational research Vol. 227; no. 3; pp. 464 - 470 |
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Main Authors | , , |
Format | Journal Article |
Language | English |
Published |
Amsterdam
Elsevier B.V
16.06.2013
Elsevier Elsevier Sequoia S.A |
Subjects | |
Online Access | Get full text |
ISSN | 0377-2217 1872-6860 |
DOI | 10.1016/j.ejor.2013.01.013 |
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Summary: | ► We study inventory allocation and shipping for a producer with limited capacity. ► We consider a manufacturer competing with other retailers to sell items. ► We identify the optimal inventory allocation strategy for a manufacturer.
We address the concept of an integrated inventory allocation and shipping model for a manufacturer with limited production capacity and multiple types of retailers with different backorder/waiting and delivery costs. The problem is to decide how to allocate and deliver produced items when the total retailer demand exceeds the production capacity, so that total retailer backorder and delivery costs are minimized. Our analytical model provides optimal allocation and shipping policies from the manufacturer’s viewpoint. We also investigate the allocation strategy of a manufacturer competing with other retailers to directly sell to end consumers. |
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Bibliography: | SourceType-Scholarly Journals-1 ObjectType-Feature-1 content type line 14 |
ISSN: | 0377-2217 1872-6860 |
DOI: | 10.1016/j.ejor.2013.01.013 |