A heuristic algorithm for managing inventory in a multi-echelon environment (original) (raw)
Related papers
Discrete Dynamics in Nature and Society
In the present study, a mathematical model is provided for inventory management in a three-level supply chain including a supplier, a manufacturer, and a distributor, taking into account the potential for product deficiency. Significant parameters such as the optimal order size for raw materials, optimal production rate, optimal allowed deficiencies at each supply chain level, the of the vehicles and the number of times the products are delivered between the supply chain components have been provided aiming at minimizing inventory management costs in the supply chain. The problem was solved using a heuristic algorithm. The proposed model is implemented for 20 different numerical examples. According to the results, the difference between the solutions obtained from the algorithm and the solutions obtained from the optimal values with the real variables is an average of 1.52%.
2015 International Conference on Industrial Engineering and Operations Management (IEOM), 2015
The aim of this paper is to assess the service levels from different point of views by modeling the inventory and warehouse variables. For this reason a main model has been formed and this model has been solved by dividing into inventory sub-model and warehouse sub-model. For the sake of effective implementation of 'order-picking ', the warehouse has been divided into two different areas. These areas are; forward area and reserve area. A predictive approach has been embraced for solvation of the model. A real implementation has been realized in a company acting in the healthcare sector. Because of the nature of the implemented healthcare sector, no limitation has been made for service level. An optimum service level definition approach has been preferred with regard to 'costing'. When it is considered from this point of view, the model is a kind of 'full cost model'. The assessments of numerical results has been made according to different service levels. Not only 'cost effectiveness' but other factors also taken into consideration for the assessment of the results.
An Approach to Capacity Planning of Distribution Warehouses for X-Firm
There are two results of the solution approach: the first and improved solution capacity plans. The capacity plan of the first solution meets our second preference (i.e., to let an insufficient capacity ii occurs at Site II), but this capacity plan is not feasible, since the needed capacity at Sites I and II is imbalanced, i.e., there is 52% of remaining capacity at Site I (2,254 pallet positions) and 24% of insufficient capacity at Site II (919 pallet positions) in 2014 (see .1-17 on page 73).
A New Heuristic for one Warehouse and N Retailers Problem
Procedia - Social and Behavioral Sciences, 2012
We considered an inventory/distribution system containing one warehouse and N retailers. There are a lot of heuristics in the literature for this problem. We proposed a new heuristic to this problem by this paper. The objective of this paper is to minimize supply chain costs of the whole system by a new heuristic. The main idea of heuristic is to compare replenishment cost with inventory holding cost. In order to analyze the effectiveness of the new heuristic, we compared it with Abdul-We generated 100 different test problems. The computational results showed that new heuristic outperforms Abdulheuristic (1.923%).
Logistics planning and control under uncertainties in distribution centers
This paper presents the challenges of distribution facilities coping with high uncertainties in demand and supply. Then a case is presented to highlight the uncertain distribution environment and to introduce an indicator to measure the nature of problems facing distribution centers. It is shown that there is a need for a "Synchronized Logistics Planning and Control System" to closely coordinate purchasing, sales and logistics departments' decision-making processes. The concept of such a system is presented and the key characteristics of the developed concept are integrate process approach, robustness and flexibility to handle both demand and supply uncertainties. The concept enables distributors to move from a buy-hold-sell distribution model to a sell-source-ship model and speed the movement of goods through the distribution center.
An integrated model for warehouse and inventory planning
European Journal of Operational Research, 2010
We propose a tactical model which integrates the replenishment decision in inventory management, the allocation of products to warehousing systems and the assignment of products to storage locations in warehousing management. The purpose of this article is to analyse the value of integrating warehouse and inventory decisions. This is achieved by proposing two methods for solving this tactical integrated model which differ in the level of integration of the inventory and warehousing decisions. A computational analysis is performed on a real world database and using multiple scenarios differing by the warehouse capacity limits. Our observation is that the total cost of the inventory and warehousing systems can be reduced drastically by taking into account the warehouse capacity restrictions in the inventory planning decisions, in an aggregate way. Moreover additional inventory and warehouse savings can be achieved by using more sophisticated integration methods for inventory and warehousing decisions.
Heuristics for a multiperiod inventory routing problem with production decisions
Computers & Industrial Engineering, 2009
Manufacturers who resupply a large number of retailers on a periodic basis continually struggle with the question of how to formulate a replenishment strategy. This paper presents a comparative analysis of a series of heuristics for an inventory routing problem (IRP) that arises in a manufacturing supply chain. The IRP is formulated as a mixed integer program with the objective of maximizing the net benefits associated with making deliveries in a specific time period to a widely dispersed set of customers. It is assumed that inventory can accumulate at the customer sites, but that all demand must be met without backlogging. Because optimal solutions were not within reach of exact methods, a two-step procedure was developed that first estimates daily delivery quantities and then solves a vehicle routing problem for each day of the planning horizon. As part of the methodology, a linear program is used to determine which days it is necessary to make at least some deliveries to avoid stockouts.
A NEW HEURISTIC METHOD FOR INVENTORY CONTROL OF CUSTOMIZED MASS PRODUCTION
users.iit.uni-miskolc.hu
Inventory control has been considered an essential problem in the management of supplier companies for several decades. In recent years numerous new supply chain and inventory control models have been developed to support management decisions. In this paper, we investigate the classical one-customer and one-supplier (newsvendor) problem with an analytical, event-oriented model. Our basic aim is to extend the classical news vendor model to n periods, which means that management decisions will be made only once at the beginning of a predefined time horizon based on demand forecast information. A new heuristic method was developed to determine the optimal length of the time horizon. We examine the problem by means of our own simulation method and discuss the results.