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Integrated design and operation of remnant inventory supply chains under uncertainty

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  • Rajgopal, Jayant
  • Wang, Zhouyan
  • Schaefer, Andrew J.
  • Prokopyev, Oleg A.

Abstract

We consider the simultaneous design and operation of remnant inventory supply chains. Remnant inventory is generated when demand for various lengths of a product may be satisfied by existing inventory, or by cutting a large piece into smaller pieces. We formulate our problem as a two-stage stochastic mixed-integer program. In solving our stochastic program, we enhance the standard L-shaped method in two ways. Our computational experiments demonstrate that these enhancements are effective, dramatically reducing the solution time for large instances.

Suggested Citation

  • Rajgopal, Jayant & Wang, Zhouyan & Schaefer, Andrew J. & Prokopyev, Oleg A., 2011. "Integrated design and operation of remnant inventory supply chains under uncertainty," European Journal of Operational Research, Elsevier, vol. 214(2), pages 358-364, October.
    • Handle: RePEc:eee:ejores:v:214:y:2011:i:2:p:358-364
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    References listed on IDEAS

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    2. Daniel Adelman & George L. Nemhauser, 1999. "Price-Directed Control of Remnant Inventory Systems," Operations Research, INFORMS, vol. 47(6), pages 889-898, December.
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    5. Jayant Rajgopal & Zhouyan Wang & Andrew Schaefer & Oleg Prokopyev, 2009. "Effective management policies for remnant inventory supply chains," IISE Transactions, Taylor & Francis Journals, vol. 41(5), pages 437-447.
    6. Mazzola, Joseph B. & Neebe, Alan W., 1999. "Lagrangian-relaxation-based solution procedures for a multiproduct capacitated facility location problem with choice of facility type," European Journal of Operational Research, Elsevier, vol. 115(2), pages 285-299, June.
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    Cited by:

    1. Poudel, Sushil Raj & Marufuzzaman, Mohammad & Bian, Linkan, 2016. "A hybrid decomposition algorithm for designing a multi-modal transportation network under biomass supply uncertainty," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 94(C), pages 1-25.

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