Stock Allocation in a Two-Echelon Distribution System Or “What to Do Until Your Ship Comes In”

In this paper, we focus on a single order cycle of a warehouse, serving N retailers where the only shipments allowed during the cycle are from the warehouse to the retailers. For a simple ship-up-to-S allocation policy, we develop both the exact cost model and a computationally tractable approximate cost model for the case of identical retailers, and demonstrate empirically the benefits of centralizing at least a portion of the total system stock.

• 저널Management Science · 34(7) · 880–895
• 토픽Supply Chain and Inventory Management · Management Information Systems
• DOI10.1287/mnsc.34.7.880
• 저자P JACKSON