IDEAS home Printed from https://ideas.repec.org/a/ids/ijlsma/v38y2021i2p253-276.html
   My bibliography  Save this article

A simulation-optimisation approach to determine optimal order-up-to level for inventory system with long lead time

Author

Listed:
  • C. Jeenanunta
  • V. Kongtarat
  • J. Buddhakulsomsiri

Abstract

This paper proposes a simulation-optimisation technique to determine an optimal order-up-to level for a single product in a periodic review inventory system. A vital aspect of the problem is that the replenishment lead time is much longer than the review period. Customer demands are stochastic, discrete, and intermittent, and the lead times are stochastic and discrete. With these demand and lead time characteristics, an empirical distribution is used to fit the distribution of demand during the lead time. A simulation-optimisation approach is developed with the objective to minimise the total annual inventory management cost, which consists of the holding cost and backlog cost, while maintaining an acceptable service level. Real data from a warehouse of an international trading company are used to test the performance of the proposed method. Results from a computational test show the method effectiveness.

Suggested Citation

  • C. Jeenanunta & V. Kongtarat & J. Buddhakulsomsiri, 2021. "A simulation-optimisation approach to determine optimal order-up-to level for inventory system with long lead time," International Journal of Logistics Systems and Management, Inderscience Enterprises Ltd, vol. 38(2), pages 253-276.
    • Handle: RePEc:ids:ijlsma:v:38:y:2021:i:2:p:253-276
    as

    Download full text from publisher

    File URL: http://www.inderscience.com/link.php?id=113250
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. K. Jeganathan & S. Selvakumar & S. Saravanan & N. Anbazhagan & S. Amutha & Woong Cho & Gyanendra Prasad Joshi & Joohan Ryoo, 2022. "Performance of Stochastic Inventory System with a Fresh Item, Returned Item, Refurbished Item, and Multi-Class Customers," Mathematics, MDPI, vol. 10(7), pages 1-37, April.
    2. Madison J. Bixler & Dorothée Honhon, 2021. "Exploring the Connections between Backrooms, Inventory Record Inaccuracies, and Waste," Sustainability, MDPI, vol. 13(17), pages 1-12, August.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ids:ijlsma:v:38:y:2021:i:2:p:253-276. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sarah Parker (email available below). General contact details of provider: http://www.inderscience.com/browse/index.php?journalID=134 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.