IDEAS home Printed from https://ideas.repec.org/p/hal/journl/hal-01217344.html
   My bibliography  Save this paper

An inventory control model with interconnected logistic services for vendor inventory management

Author

Listed:
  • Yanyan Yang

    (CGS i3 - Centre de Gestion Scientifique i3 - Mines Paris - PSL (École nationale supérieure des mines de Paris) - PSL - Université Paris Sciences et Lettres - I3 - Institut interdisciplinaire de l’innovation - CNRS - Centre National de la Recherche Scientifique)

  • Shenle Pan

    (CGS i3 - Centre de Gestion Scientifique i3 - Mines Paris - PSL (École nationale supérieure des mines de Paris) - PSL - Université Paris Sciences et Lettres - I3 - Institut interdisciplinaire de l’innovation - CNRS - Centre National de la Recherche Scientifique)

  • Eric Ballot

    (CGS i3 - Centre de Gestion Scientifique i3 - Mines Paris - PSL (École nationale supérieure des mines de Paris) - PSL - Université Paris Sciences et Lettres - I3 - Institut interdisciplinaire de l’innovation - CNRS - Centre National de la Recherche Scientifique)

Abstract

This paper proposes an inventory control model taking advantage of interconnected logistic services in the Physical Internet for fast-moving consumer goods (FMCG) sector. Unlike current hierarchical inventory model where the source of each is pre-assigned, the goods are stored and distributed in an interconnected and open network of PI-hubs which enables storage capacity and transportation sharing among different companies around the network. As a result, theoretically, the suppliers can push their goods all around the network and the retailers can be served by any hub in the network. A non-linear global optimization inventory model to minimize the total logistic costs is proposed and a heuristic using simulated annealing is applied to solve the problem. Numerical experiments are taken to compare the performance of the proposed PI inventory model and classic inventory control model for different settings of a typical supply network. Results suggest that the PI inventory control model can always reduce the total logistic cost while reaching a comparable or improved end customer service level.

Suggested Citation

  • Yanyan Yang & Shenle Pan & Eric Ballot, 2015. "An inventory control model with interconnected logistic services for vendor inventory management," Post-Print hal-01217344, HAL.
    • Handle: RePEc:hal:journl:hal-01217344
    Note: View the original document on HAL open archive server: https://minesparis-psl.hal.science/hal-01217344v1
    as

    Download full text from publisher

    File URL: https://minesparis-psl.hal.science/hal-01217344v1/document
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Paterson, Colin & Kiesmüller, Gudrun & Teunter, Ruud & Glazebrook, Kevin, 2011. "Inventory models with lateral transshipments: A review," European Journal of Operational Research, Elsevier, vol. 210(2), pages 125-136, April.
    2. Rochdi Sarraj & Eric Ballot & Shenle Pan & Driss Hakimi & Benoit Montreuil, 2014. "Interconnected logistic networks and protocols: simulation-based efficiency assessment," Post-Print hal-01112138, HAL.
    3. Senthil Veeraraghavan & Alan Scheller-Wolf, 2008. "Now or Later: A Simple Policy for Effective Dual Sourcing in Capacitated Systems," Operations Research, INFORMS, vol. 56(4), pages 850-864, August.
    4. Ng, C. T. & Li, Leon Y. O. & Chakhlevitch, K., 2001. "Coordinated replenishments with alternative supply sources in two-level supply chains," International Journal of Production Economics, Elsevier, vol. 73(3), pages 227-240, October.
    5. Song, Dong-Ping & Dong, Jing-Xin & Xu, Jingjing, 2014. "Integrated inventory management and supplier base reduction in a supply chain with multiple uncertainties," European Journal of Operational Research, Elsevier, vol. 232(3), pages 522-536.
    6. Diks, E. B. & de Kok, A. G., 1998. "Optimal control of a divergent multi-echelon inventory system," European Journal of Operational Research, Elsevier, vol. 111(1), pages 75-97, November.
    7. Shenle Pan & Michele Nigrelli & Eric Ballot & Rochdi Sarraj & Yanyan Yang, 2015. "Perspectives of inventory control models in the Physical Internet: A simulation study," Post-Print hal-01112144, HAL.
    8. Walter J. Bell & Louis M. Dalberto & Marshall L. Fisher & Arnold J. Greenfield & R. Jaikumar & Pradeep Kedia & Robert G. Mack & Paul J. Prutzman, 1983. "Improving the Distribution of Industrial Gases with an On-Line Computerized Routing and Scheduling Optimizer," Interfaces, INFORMS, vol. 13(6), pages 4-23, December.
    9. Ryu, Si Wook & Lee, Kyung Keun, 2003. "A stochastic inventory model of dual sourced supply chain with lead-time reduction," International Journal of Production Economics, Elsevier, vol. 81(1), pages 513-524, January.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Yanyan Yang & Shenle Pan & Eric Ballot, 2015. "A model to take advantage of Physical Internet for vendor inventory management [Un modèle de gestion de stock en avantage de l'Internet Physique pour les vendeurs]," Post-Print hal-01128761, HAL.
    2. Svoboda, Josef & Minner, Stefan & Yao, Man, 2021. "Typology and literature review on multiple supplier inventory control models," European Journal of Operational Research, Elsevier, vol. 293(1), pages 1-23.
    3. Neves-Moreira, Fábio & Almada-Lobo, Bernardo & Guimarães, Luís & Amorim, Pedro, 2022. "The multi-product inventory-routing problem with pickups and deliveries: Mitigating fluctuating demand via rolling horizon heuristics," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 164(C).
    4. Hekimoğlu, Mustafa & Scheller-Wolf, Alan, 2023. "Dual sourcing models with stock-out dependent substitution," European Journal of Operational Research, Elsevier, vol. 311(2), pages 472-485.
    5. Fahim, Patrick B.M. & Rezaei, Jafar & Montreuil, Benoit & Tavasszy, Lorant, 2022. "Port performance evaluation and selection in the Physical Internet," Transport Policy, Elsevier, vol. 124(C), pages 83-94.
    6. Christian Howard & Johan Marklund & Tarkan Tan & Ingrid Reijnen, 2015. "Inventory Control in a Spare Parts Distribution System with Emergency Stocks and Pipeline Information," Manufacturing & Service Operations Management, INFORMS, vol. 17(2), pages 142-156, May.
    7. Kim, Nayeon & Montreuil, Benoit & Klibi, Walid & Kholgade, Nitish, 2021. "Hyperconnected urban fulfillment and delivery," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 145(C).
    8. Nguyen, Tiep & Duong, Quang Huy & Nguyen, Truong Van & Zhu, You & Zhou, Li, 2022. "Knowledge mapping of digital twin and physical internet in Supply Chain Management: A systematic literature review," International Journal of Production Economics, Elsevier, vol. 244(C).
    9. Vidal, Thibaut & Laporte, Gilbert & Matl, Piotr, 2020. "A concise guide to existing and emerging vehicle routing problem variants," European Journal of Operational Research, Elsevier, vol. 286(2), pages 401-416.
    10. Cheaitou, Ali & van Delft, Christian, 2013. "Finite horizon stochastic inventory problem with dual sourcing: Near myopic and heuristics bounds," International Journal of Production Economics, Elsevier, vol. 143(2), pages 371-378.
    11. Peres, Igor T. & Repolho, Hugo M. & Martinelli, Rafael & Monteiro, Nathália J., 2017. "Optimization in inventory-routing problem with planned transshipment: A case study in the retail industry," International Journal of Production Economics, Elsevier, vol. 193(C), pages 748-756.
    12. Topan, E. & van der Heijden, M.C., 2020. "Operational level planning of a multi-item two-echelon spare parts inventory system with reactive and proactive interventions," European Journal of Operational Research, Elsevier, vol. 284(1), pages 164-175.
    13. Yanyan Yang & Shenle Pan & Eric Ballot, 2017. "Mitigating supply chain disruptions through interconnected logistics services in the Physical Internet," International Journal of Production Research, Taylor & Francis Journals, vol. 55(14), pages 3970-3983, July.
    14. Ahiska, S. Sebnem & Appaji, Samyuktha R. & King, Russell E. & Warsing, Donald P., 2013. "A Markov decision process-based policy characterization approach for a stochastic inventory control problem with unreliable sourcing," International Journal of Production Economics, Elsevier, vol. 144(2), pages 485-496.
    15. Bin Zhang & Zekai Lai & Qiangqiang Wang, 2021. "Multi-product dual sourcing problem with limited capacities," Operational Research, Springer, vol. 21(3), pages 2055-2075, September.
    16. Van der Heide, G. & Buijs, P. & Roodbergen, K.J. & Vis, I.F.A., 2018. "Dynamic shipments of inventories in shared warehouse and transportation networks," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 118(C), pages 240-257.
    17. Noordhoek, Marije & Dullaert, Wout & Lai, David S.W. & de Leeuw, Sander, 2018. "A simulation–optimization approach for a service-constrained multi-echelon distribution network," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 114(C), pages 292-311.
    18. Ben-Ammar, Oussama & Bettayeb, Belgacem & Dolgui, Alexandre, 2019. "Optimization of multi-period supply planning under stochastic lead times and a dynamic demand," International Journal of Production Economics, Elsevier, vol. 218(C), pages 106-117.
    19. Carole Camisullis & Vincent Giard, 2010. "Détermination des stocks de sécurité dans une chaîne logistique-amont dédiée à une production de masse de produits fortement diversifiés," Working Papers hal-00876986, HAL.
    20. A. Mor & M. G. Speranza, 2020. "Vehicle routing problems over time: a survey," 4OR, Springer, vol. 18(2), pages 129-149, June.

    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:hal:journl:hal-01217344. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: CCSD (email available below). General contact details of provider: https://hal.archives-ouvertes.fr/ .

    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.