Stochastic joint replenishment problems: periodic review policies

Abstract

Operations Managers of manufacturing systems, distribution systems, and supply chains address lot sizing and scheduling problems as part of their duties. These problems are concerned with decisions related to the size of orders and their schedule. In general, products share or compete for common resources and thus require coordination of their replenishment decisions whether replenishment involves manufacturing operations or not. This research is concerned with joint replenishment problems (JRPs) which are part of multi-item lot sizing and scheduling problems in manufacturing and distribution systems in single echelon/stage systems. The principal purpose of this research is to develop three new periodic review policies for stochastic joint replenishment problem. It also highlights the lack of research on joint replenishment problems with different demand classes (DSJRP). Therefore, periodic review policy is developed for this problem where the inventory system faces different demand classes that are deterministic demand and stochastic demand. Heuristic Algorithms have been developed to obtain (near) optimal parameters for the three policies as well as a heuristic algorithm has been developed for DSJRP. Numerical tests against literature benchmarks have been presented.