Search

Companies increasingly employ dual-channeling strategies with online and offline channels to reach customers. The combination of high return rates in e-commerce and the possibility for customers to return products ordered online at any offline store may result in unbalanced inventories. Transshipments can be used to deal with these unbalanced inventories. In this paper we study dynamic policies for transshipment of products that are returned cross-channel from online to offline stores. At the end of each period in a finite sales season, cross-channel returned products can be transshipped back to the online store or kept on-hand at the offline store. Optimal transshipment policies are obtained using a Markov decision process. We introduce a well-performing heuristic based on the expected costs during the sales season, with a maximum deviation of 1.59 % from the optimal costs in experiments. Furthermore, we show that in all instances our heuristic outperforms static policies in which products are either always or never shipped back to the online store. We observe that dynamic transshipment policies are more effective than static policies in dealing with imbalances in the initial stock. Dynamic transshipment of cross-channel returns seems to open up possibilities for more effective demand fulfillment of dual-channel companies.

A research method for multi-echelon inventory allocation of civil aircraft spare parts with lateral transshipments and maintenance ratio is proposed in this paper, and the maintenance rate is considered into the inventory model, aiming at the problem of multi-echelon inventory allocation with lateral transshipments for civil aircraft spare parts. Firstly, the principle of the multi-echelon inventory model with lateral transshipments and maintenance ratio is proposed. Then, by considering the fleet availability and the satisfaction ratio as the constraints, a mathematical model is built with the inventory system total cost as the optimization objective. Secondly, the procedure of solving multi-echelon inventory allocation model considering the influence of lateral transshipments and maintenance ratio is discussed based on the marginal analysis method. Finally, some components of Boeing 737 are selected as the research objects, the multi-echelon inventory allocation is investigated by considering lateral transshipments and maintenance ratio. The analysis results in this paper show the best number of multi echelon inventory allocation, the minimum inventory system total cost and the fleet availability are 1.205 million dollars and 0.9909 respectively. Comparing the traditional inventory model without considering lateral transshipments and maintenance ratio, and the model which only considers the maintenance ratio, the results indicate that the model offered in this paper could reduce the total cost of inventory system significantly, and provides theoretical support and method guidance for the accurate allocation of multi echelon inventory optimization for civil aircraft spare parts.

Various rental systems, such as public libraries and tool rental companies, have a support warehouse for storing rental products at low cost and carrying out expedited shipments in response to stock-outs at local warehouses. In case of stock-outs, rental systems commonly employ partial backordering, i.e., a limited number of demands is backordered while additional demand is lost. We include partial backordering in our models and demonstrate its relevance. We fully characterize costs and optimal base stock policies in cases with one support and one local warehouse and provide upper bounds for base stock levels in the general system. By enumerating base stock policies and evaluating exact costs numerically, we determine optimal base stock policies for small systems with up to six local warehouses. For larger systems we develop a greedy algorithm based on approximate cost evaluations. The resulting base stock policies have costs within 0.2% from optimality on average in experiments. Among other things, experiments indicate that existing methods with no backordering may lead to poor solutions with partial backordering and that partial backordering is an effective means to reduce lost demand even with limited partial backorder levels. (C) 2017 Elsevier B.V. All rights reserved.

We consider a multi-item spare parts problem with multiple warehouses and two customer classes, where lateral transshipments are used as a differentiation tool. Specifically, premium requests that cannot be met from stock at their preferred warehouse may be satisfied from stock at other warehouses (so-called lateral transshipments). We first derive approximations for the mean waiting time per class in a single-item model with selective lateral transshipments. Next, we embed our method in a multi-item model minimizing the holding costs and costs of lateral and emergency shipments from upstream locations in the network. Compared to the option of using only selective emergency shipments for differentiation, the addition of selective lateral transshipments can lead to significant further cost savings (14% on average). ?? 2014 Elsevier B.V. All rights reserved.

Inventory redistribution and emergency replenishment in supply chains have long been studied in various contexts. From our strategic perspective, both systems can be used alternatively to cope with product shortages in a supply chain, especially for situations where high shortage costs are involved. In this paper, we present an incorporated scheme of lateral transshipments and emergency orders in a multi-location inventory system. We focused on a complex distribution network consisting of a capacitated distribution center and multiple retailers. A mathematical model is formulated in order to determine optimal inventory policies of the integrated systems. Lastly, we proposed a solution methodology using a hybrid Genetic Algorithm to solve the integrated multi-location inventory problem.