(S, S) Policies for a Dynamic Inventory Model with Stochastic Lead Times
(S, S) Policies for a Dynamic Inventory Model with Stochastic Lead Times

Author: Richard Ehrhardt

Publisher:

Published: 1980

Total Pages: 29

ISBN-13:

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A stochastic lead time inventory model is analyzed under the assumptions that (1) replenishment orders do not cross in time and (2) the lead time distribution for a given order is independent of the number and sizes of outstanding orders. This study corrects errors in the existing literature on the finite-horizon version of the model and yields an intuitively appealing dynamic program that is nearly identical to one that would apply in a transformed model with all lead times fixed at zero. Hence, many results that have been derived for fixed lead time models generalized easily. Conditions for the optimality of (s, S) policies are established for both finite and infinite planning horizons. The infinite-horizon model analysis is extended by adapting the fixed lead time results for the efficient computation of optimal and approximately optimal (s, S) policies. (Author).

A Survey of Stochastic Inventory Models with Fixed Costs
A Survey of Stochastic Inventory Models with Fixed Costs

Author: Sandun C. Perera

Publisher:

Published: 2022

Total Pages: 0

ISBN-13:

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Fixed costs of ordering items or setting up a process arise in many real-life scenarios. In their presence, the most widely used ordering policy in the stochastic inventory literature is the (s, S) policy. Optimality of (s, S) policies and (s, S)-type policies have been investigated for various inventory models, including those with discrete- and continuous-time reviews, finite- and infinite-time horizons, discounted- and average-cost objectives, backlogging and lost-sales settings, standard and generalized demand and cost structures, deterministic and stochastic lead times, single- and multi-product settings, and coordinated pricing-inventory decisions. This survey provides a comprehensive review of this highly mature literature dating back to 1951. We discuss model specifications, proof techniques, specific results, and limitations of the papers published on the topic. We conclude the survey by providing suggestions for extensions and directions for future research.