A novel modeling approach for a capacitated (S,T) inventory system with backlog under stochastic discrete demand and lead time

Tai, P.; Huyen, P.; Buddhakulsomsiri, J.

Growing Science » International Journal of Industrial Engineering Computations » A novel modeling approach for a capacitated (S,T) inventory system with backlog under stochastic discrete demand and lead time

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International Journal of Industrial Engineering Computations

ISSN 1923-2934 (Online) - ISSN 1923-2926 (Print) Quarterly Publication Volume 12 Issue 1 pp. 1-14 , 2021

A novel modeling approach for a capacitated (S,T) inventory system with backlog under stochastic discrete demand and lead time Pages 1-14 Download PDF

Authors: Pham Duc Tai, Pham Phuong Ngoc Huyen, Jirachai Buddhakulsomsiri

DOI: 10.5267/j.ijiec.2020.10.004

Keywords: Order-up-to level policy, Periodic review, Warehouse capacity, Stochastic demand, Uncertain lead time

Abstract: In this paper, a new period-based approach is proposed for modeling a capacitated inventory system, operating under an (S,T) policy with backlog. The system experiences stochastic discrete demand and lead time. By using the proposed method, a mathematical model is developed. The model can accurately estimate the inventory system measures of performance: the expected inventory on-hands and over-storage amount. Through a simulation experiment, the new model is compared with two other models, which are developed by using a widely used mean-based approach. The comparison is conducted based on a case study data set. The results demonstrate that the period-based model is superior to the mean-based models with respect to capturing the behaviors of the inventory system. Therefore, better inventory policy parameters can be obtained by employing the new model.

How to cite this paper

 Tai, P., Huyen, P & Buddhakulsomsiri, J. (2021). A novel modeling approach for a capacitated (S,T) inventory system with backlog under stochastic discrete demand and lead time.International Journal of Industrial Engineering Computations , 12(1), 1-14.

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