Batch Ordering Problem in Multi Item Two Echelon Spare Parts Inventory Control Systems

Date

2008-08-22

Author

Bayındır, Zeynep Pelin

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BATCH ORDERING PROBLEM IN MULTI ITEM TWO ECHELON SPARE PARTS INVENTORY CONTROL SYSTEMS Engin Topan, Zeynep Pelin Bayindir, Tarkan Tan In this study we deal with a multi-item two-echelon spare parts inventory control system in which the central warehouse operates with reorder point/order quantity (Q,R) policy whereas local warehouses implements one-for-one replenishment. In this environment we study the batch ordering problem of the corresponding system. There are two common approaches in determining policy parameters. One approach is the sequential approach in which the order sizes are determined at first, in most cases by EOQ-rule, then given the order sizes, the reorder level for the central warehouse and the basestock levels for the local warehouses are determined. The other approach is the simultaneous approach in which all the control parameters of the system including the order size are optimized simultaneously. The former one is suboptimal, but due to its simplicity, very common in the spare parts business. One aim of this study is to test the performances of the sequential approach and the simultaneous approach in a multi-item setting. In order to accomplish this goal we need an exact solution procedure for the problem. The second aim of this study is to propose an exact solution procedure for the problem. The procedure is based on using the Lagrangean dual bound in a branch and bound procedure. Later this solution procedure is used to test the performances of the sequential approach and the simultaneous approach. By doing so, we hope to evaluate the value of “optimal solution” of batch ordering problem in a multi item two-echelon distribution system

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https://hdl.handle.net/11511/81227

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Citation Formats

Z. P. Bayındır, “Batch Ordering Problem in Multi Item Two Echelon Spare Parts Inventory Control Systems,” 2008, Accessed: 00, 2021. [Online]. Available: https://hdl.handle.net/11511/81227.