| In many companies and organisations the planning and control of purchasing,
production, inventory and transportation is of great importance. In a
manufacturing industry it is not unusual that the value of the total stock of
end products and parts in production is larger than the value of the production
system itself with its machines and factory buildings. Efficient control of
inventory and production, so that low capital costs, good customer service and a
high and smooth capacity utilization are achieved, is one of the keys to
success. In this thesis we consider various inventory control problems that are
important in this context, and focus especially on coordination of levels and
items.
Multi-level and multi-item inventory systems are common both in production
and distribution systems. When designing control policies for such inventory
systems we have to consider customer service, transportation times, holding
costs and ordering costs. With better control, it is possible for many companies
to both improve customer service and to reduce capital costs. In many cases new
and improved inventory models, faster and cheaper computers and more correct
information make it possible to improve the inventory control.
We assume in this thesis that the conditions for the inventory system are
given, for example, holding and shortage costs, lead-times, and the structure of
the inventory system. In practice these conditions are possible to change, at
least in the long run. Changes in the structure of the inventory system and
shorter lead-times can give considerable cost reductions. By varying basic
assumptions in the models and methods in this thesis it is also possible to
evaluate how such changes in the structure of the inventory system will affect
the optimal cost and the optimal ordering policies.
Two different inventory systems are treated in this thesis. In the first four
papers we consider a multi-echelon inventory system with one central warehouse
and N different retailers. For this inventory system we consider two types of
ordering policies, (R, Q)- policies and order-up-to-S policies. Furthermore, we
consider different types of stochastic customer demands. In the last paper we
consider joint ordering policies for a multi-item, single-level inventory
system.
The contributions concerning multi-echelon inventory systems are:
- we develop an approximate optimization method for systems with one-for-one
ordering policies and generally distributed customer demand,
- we evaluate and optimize one-for-one ordering policies for compound Poisson
demand,
- we evaluate and optimize batch ordering policies for Poisson demand,
- we evaluate and optimize batch ordering policies for Erlang distributed
customer inter-arrival times,
- we evaluate and optimize batch ordering policies for generally distributed
customer inter-arrival times.
The contribution concerning the
coordinated multi-item single-level inventory system is:
- we evaluate and optimize an ordering policy that gives low fluctuations in
the total order quantity. Low fluctuations in the total order quantity are
preferable when the ordering cost increases/ decreases step-wise as a function
of the total order quantity.
Keywords
multi-echelon, multi-item, stochastic model, Poisson demand, compound
Poisson demand, coordinated replenishment, joint replenishment, lot sizing
policy, ordering policy
Faculty opponent
Professor Ton de Kok
Dept. for Industrial Engineering and Management
Sciences
Eindhoven University of Technology
P.O Box 513, 5600 MB
Eindhoven, The Netherlands
This dissertation consists of a collection of articles
List of included articles
- AXSĦER, S., R. FORSBERG. and W. F. ZHANG 1994. Approximating General
Multi-Echelon Inventory Systems by Poisson Models. International Journal of
Production Economics, 35, 201-206.
- FORSBERG, R. 1995. Optimization of Order-up-to-S Policies for Two-Level
Inventory Systems with Compound Poisson Demand. European Journal of Operational
Research, 81, 143-153.
- FORSBERG, R. 1995. Exact Evaluation of (R, Q)-Policies for Two-Level
Inventory Systems with Poisson Demand. European Journal of Operational Research,
(to appear).
- FORSBERG, R. 1995. Evaluation of (R, Q)-Policies for Two-Level Inventory
Systems with Generally Distributed Customer Inter-Arrival Times. European
Journal of Operational Research, (to appear).
- FORSBERG, R. 1996. A Joint Replenishment Strategy for Inventory Systems with
Poisson Demand. Lund University, 1996.
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