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Approximate solutions and cost error bounds for quantity flexibility replenishment

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  • Zhu, Stuart X.

Abstract

Under an environment with quantity flexibility replenishment, we explore the approximate solutions to determine ordering quantities when the demand is correlated with dynamic forecast updating. Moreover, we show the optimality of the myopic policy. We further develop the corresponding cost error bounds to evaluate the performance of the approximate solutions. Extensive numerical experiments demonstrate that our approximate solution can achieve a lower cost performance compared with other bounds.

Suggested Citation

  • Zhu, Stuart X., 2017. "Approximate solutions and cost error bounds for quantity flexibility replenishment," International Journal of Production Economics, Elsevier, vol. 193(C), pages 306-315.
    • Handle: RePEc:eee:proeco:v:193:y:2017:i:c:p:306-315
    DOI: 10.1016/j.ijpe.2017.07.022
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    References listed on IDEAS

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