An (s, S) random lifetime inventory model with a positive lead time

✍ Scribed by Liming Liu; Tao Yang

• Publisher: Elsevier Science
• Year: 1999
• Tongue: English
• Weight: 125 KB
• Volume: 113
• Category: Article
• ISSN: 0377-2217
• DOI: 10.1016/s0377-2217(97)00426-8

✦ Synopsis

Positive lead times substantially complicate the modeling and analysis of inventory systems with ®nite shelf lifetimes and they have not been suciently addressed in the existing literature. In this paper, we analyze an (s, S) continuous review model with a positive lead time. We assume an exponential lifetime and an exponential lead time. Matrixgeometric solutions can be obtained for the steady state probability distribution of the inventory level. We then derive the total expected cost function. We carry out numerical studies and gain insights to the selection of system parameters. The ®ndings on the impact of a positive lead time on the optimal reorder point and reorder batch size will be useful in developing strategies in handling inventory problems with ®nite lifetimes and positive lead times.