Questions tagged [inventory]

For questions about mathematical models and algorithms for optimizing inventories.

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10
votes
1answer
1k views

Loss functions for specific probability distributions?

For a random variable $X$ with pdf $f(x)$, the loss function* is defined as $$n(x) = \mathbb{E}[(X-x)^+] = \int_{x}^\infty (y-x)f(y)dy,$$ where $a^+ = \max\{a,0\}$. Or, for a discrete distribution, $...
5
votes
1answer
342 views

Safety stock for log-normal distribution demand

I came across this example on how to model your lead time demand as a log-normal distribution and calculate the safety stock. https://www.linkedin.com/pulse/why-you-keep-missing-your-service-level-...
9
votes
4answers
568 views

Recommendations for OM blogs

Could someone suggest good blogs to follow for researchers in Operations Management/ Supply Chain Management /Operations Research?
8
votes
1answer
396 views

Lead time longer than cycle time

I am trying to calculate the reorder point and safety stock for a pharmaceutical product. I am using this formula $$r = \mu_{LTD} + z_\alpha\sigma_{LTD}. $$ $$SS = z_\alpha\sigma_{LTD}. $$ where, $$...
5
votes
2answers
93 views

Estimating optimal inventory in times of high uncertainty due to coronavirus

I'm trying to help out a relative of mine who runs a small highly seasonal business in the clothing/textiles industry. 80% of sales are in Q1 of every year, and the purchasing and manufacturing ...
12
votes
4answers
1k views

Normal demand and normal lead time; is lead-time demand normal?

In a continuous-review $(r,Q)$ inventory system under a type-1 service level constraint, if the demand per unit time is distributed as $N(\mu,\sigma^2)$ and the lead time, $L$, is a constant, then the ...