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An (S − 1, S) Inventory System with Emergency Orders

Author

Listed:
  • Kamran Moinzadeh

    (University of Washington, Seattle, Washington)

  • Charles P. Schmidt

    (University of Alabama, Tuscaloosa, Alabama)

Abstract

In this paper, we develop an approximate model of an inventory control system in which there exist two options for resupply, with one having a shorter lead-time. We assume that demand and the fixed ordering costs are small relative to the holding cost so that a one-for-one ordering policy is appropriate. We consider a policy for placing emergency orders that uses information about the age of outstanding orders. We derive the steady-state behavior of this policy and present some computational results.

Suggested Citation

  • Kamran Moinzadeh & Charles P. Schmidt, 1991. "An (S − 1, S) Inventory System with Emergency Orders," Operations Research, INFORMS, vol. 39(2), pages 308-321, April.
    • Handle: RePEc:inm:oropre:v:39:y:1991:i:2:p:308-321
    DOI: 10.1287/opre.39.2.308
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