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A continuous‐review inventory system with lost sales and variable lead time

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  • Esmail Mohebbi
  • Morton J.M. Posner

Abstract

Using a system‐point (SP) method of level crossings, we derive the stationary distribution of the inventory level (stock on hand) in a continuous‐review inventory system with compound Poisson demand, Erlang as well as hyperexponentially distributed lead times, and lost sales. This distribution is then used to formulate long‐run average cost functions with/without a service level constraint. Some numerical results are also presented, and compared with the Hadley and Whitin heuristic. © 1998 John Wiley & Sons, Inc. Naval Research Logistics 45: 259–278, 1998

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  • Esmail Mohebbi & Morton J.M. Posner, 1998. "A continuous‐review inventory system with lost sales and variable lead time," Naval Research Logistics (NRL), John Wiley & Sons, vol. 45(3), pages 259-278, April.
    • Handle: RePEc:wly:navres:v:45:y:1998:i:3:p:259-278
    DOI: 10.1002/(SICI)1520-6750(199804)45:33.0.CO;2-6
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    References listed on IDEAS

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