IDEAS home Printed from https://ideas.repec.org/a/taf/uiiexx/v54y2022i12p1186-1198.html
   My bibliography  Save this article

Quantity-based emergency shipment policies

Author

Listed:
  • Saeed Poormoaied
  • Zümbül Atan
  • Tom van Woensel

Abstract

Either structurally or in an ad hoc manner, emergency shipments are widely utilized for preventing the potentially negative impacts of stock-outs. In addition to having policies for their regular orders, companies need to decide when and for how many units to place emergency orders. In this article, we consider the periodic-review problem of a retailer who uses a quantity-based emergency shipment policy. Under this policy an emergency order is triggered if the inventory level within the review period falls below a certain level. We consider the base-stock policy for the regular replenishment orders. The goal is to determine the optimal base-stock level, the optimal period length as well as the optimal size and threshold value of emergency orders such that the total expected cost rate is minimized. We use renewal reward theory to derive the expressions of operating characteristics. The expected cost rate’s properties are analyzed to develop an optimization algorithm for finding the optimal policy parameters. We compare our policy with the time-based and hybrid emergency shipment policies and conclude that the quantity-based policy can bring substantial benefits compared to other policies.

Suggested Citation

  • Saeed Poormoaied & Zümbül Atan & Tom van Woensel, 2022. "Quantity-based emergency shipment policies," IISE Transactions, Taylor & Francis Journals, vol. 54(12), pages 1186-1198, September.
    • Handle: RePEc:taf:uiiexx:v:54:y:2022:i:12:p:1186-1198
    DOI: 10.1080/24725854.2022.2041773
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/24725854.2022.2041773
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/24725854.2022.2041773?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

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

    More about this item

    Statistics

    Access and download statistics

    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:taf:uiiexx:v:54:y:2022:i:12:p:1186-1198. 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: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/uiie .

    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.