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Effect of Customer Demand on Total Inventory Cost and Order Fill Rate in a Supply Chain  

Park, Kyoung-Jong (Department of Business Administration, Gwangju University)
Publication Information
Journal of Korean Society of Industrial and Systems Engineering / v.32, no.3, 2009 , pp. 93-98 More about this Journal
Abstract
This paper studies that $\sigma$ values(10, 20, 50) and $\rho$ values(-0.6, -0.3, 0.0, 0.3, 0.6) affect the total inventory cost of a supply chain and order fill rate when the market demand process follows a general auto-correlated AR(1) process without seasonality. $\sigma$ indicates the degree of demand fluctuation and $\rho$ means the trend of demand. ANOVA tests using a 5% significance level are performed in SPSS to examine significant performance changes among various cases.
Keywords
Supply Chain; AR(1); Total Inventory Cost; Order Fill Rate;
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