• Journal of the Korean Operations Research and Management Science Society
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• v.11 no.1
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• pp.44-50
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• 1986

In this paper, we find optimal policy for the (Q, r) inventory model under the lead time uncertainty. The (Q, r) inventory model is such that the fixed order quantity Q is placed whenever the level of on hand stock reaches the reorder point r. We first develop the single level inventory model as the basis for the analysis multi-level distribution systems. The functional problem is to determine when and how much to order in order to minimize the expected total cost per unit time, which includes the set up, inventory holding and inventory shortage cost. The model, then, is extended to the multi-level distribution system consisting of the factory, warehouses and retailers. In this case, we also find an optimal policy which minimizes the total cost of the contralized multi-level distribution system.

• Korean Management Science Review
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• v.31 no.2
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• pp.1-13
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• 2014

In almost all of the organizations, the cost for acquiring and maintaining the inventory takes a considerable portion of the management budget, and thus a certain constraint is set upon the budget itself. The previous studies on inventory control for each item that aimed to improve the fill rate, backorder, and the expenditure on inventory are fitting for the commercially-operated SCM, but show some discrepancies when they are applied to the spare parts for repairing disabled systems. Therefore, many studies on systematic approach concept considering spare parts of various kinds simultaneously have been conducted to achieve effective performance for the inventory control at a lower cost, and primarily, METRIC series models can be named. However, the past studies were limited when dealing with the probability distributions for representing the situation on demand and transportation of the parts, with the (S-1, S) inventory control policy, and so on. To address these shortcomings, the Continuous Time Markov Chain (CTMC) model, which considers the phase-type distributions and the (s, Q) inventory control policies to best describe the real-world situations inclusively, is presented in this study. Additionally, by considering the cost versus the system availability, the optimization of the inventory level, based on this model, is also covered.

• Journal of Institute of Control, Robotics and Systems
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• v.3 no.5
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• pp.532-541
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• 1997

This article derives an analytic solution to determine the optimal size of multiple noncontinuous process and storage units. The total cost to be minimized consists of the setup cost of noncontinuous processing units and the inventory holding cost of feedstock/product storages. A novel approach, which is called PSW(Periodic Square Wave) model, is applied to represent the material flow among non-continuous units and storages. PSW model presumes that the material flow between unit and storage is periodic square wave shaped. The resulting optimal unit size has similar characteristics with the classical economic lot sizing model such as EOQ(Economic Order Quantity) or EPQ(Economic Production Quantity) model in a sense that the unit size is determined as the balance between setup and inventory holding cost. However, the influence of inventory holding cost of PSW model is different from that of EOQ/EPQ model. EOQ/EPQ model includes only the product inventory holding cost but PSW model includes all inventory holding costs around the non-continuous unit with proportional contribution. PSW model is suitable for analyzing interlinked process-storage system. The optimal lot size of PSW model is smaller than that of EOQ/EPQ model. This is quitea remarkable result considering that the EOQ/EPQ model has been is widely used since last half century.

• Journal of Korean Institute of Industrial Engineers
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• v.32 no.4
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• pp.382-392
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• 2006

Vendor-managed inventory policy(VMIP) is a supply-chain initiative where the supplier is authorized to manage inventories of items at retail locations. In VMIP, the supplier monitors sales and stock information at retail locations and makes decisions of inventory replenishment and transportation simultaneously. VMIP has been known as an effective supply chain strategy that can realize many of benefits obtainable only in a fully integrated supply chain. However, VMIP does not always lead to lower the supply chain cost. It sometimes generates the total supply chain cost higher than the traditional retailer-managed inventory policy (RMIP). In this paper, we perform a comparison study on RMIP and VMIP in the retail supply chain which consists of a single supplier and a number of retailers. We formulate mixed integer programming models for both RMIP and VMIP with vehicle routing problems and perform computational experiments on various test problems. Furthermore, we derive the conditions which guarantee the dominant position for VMIP with respect to total supply chain cost in the simple retail supply chain.

• Asia-Pacific Journal of Business Venturing and Entrepreneurship
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• v.9 no.2
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• pp.81-86
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• 2014

In this paper, a jointly optimal group replacement and spare provisioning policy is presented. Most maintenance policies assume that the spare inventory is always available, but in practice the maintenance schedule is affected by the availability of spare inventory. We present a maintenance-inventory model which jointly optimizes the group replacement interval and spare ordering quantity. Group replacement policy is used when a group of units are put in operation simultaneously. The operating fleet is replaced altogether at a predetermined number of units are failed. A sufficient level of spare inventory is carried to perform a number of group replacement. A cost rate expression which considers the group maintenance cost and inventory holding cost is derived and a heuristic method for searching the optimum value of decision variables is suggested. Numerical examples demonstrate the analytical results and the performance of the presented model.

• Journal of the Korean Society of Systems Engineering
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• v.12 no.2
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• pp.47-57
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• 2016

As the inventory costs of repairable items in military logistics continue to increase, many studies for optimal inventory level of these items are being carried out in advanced countries, including the US, to reduce these costs. Research on inventory level optimization for repairable items aimed to achieve the availability goal of a system with a MIME(Multi Indenture Multi Echelon) repair policy structure first began with Sherbrooke's METRIC and developed into various types. This research is to analyze and compare recent V-METRIC related studies to search for another variation in this field. This paper mainly looks at how to determine optimum inventory level for each repairable item to achieve a specific availability target within a limited budget, and also how to minimize inventory cost while achieving its availability target by determining optimal inventory level of each repairable item.

• Journal of Korean Society for Quality Management
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• v.17 no.2
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• pp.149-157
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• 1989

A one-upper warehouse n-lower retailer inventory model is discussed. The probability distribution of demand for a given perod is independent. The inventory holding cost is proportional to the number of unsold units and the cost of shortages is proportional to the number of shortages. In the event of a shortage, units are redistributed with a cost proportional to the number of units from the retailers which are a surplus at the end of the period. The optimum stock levels are obtained and the effects of redistribution are analized.

• Journal of the military operations research society of Korea
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• v.9 no.1
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• pp.69-74
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• 1983

This article presents a deterministic inventory model for situations in which, during the stockout period, a fraction ${\beta}$ of the demand is backordered and the remaining fraction $1-{\beta}$ is lost. By defining a time proportional backorder cost and a fixed penalty cost per unit lost, a convex objective function representing the average annual cost of operating the inventory system is obtained. The optimal operating policy variables are calculated directly. At the extremes ${\beta}\;=\;1$ and ${\beta}\;=\;0$ the model presented reduces to the usual backorders and lost sales case, respectively.

• Journal of Korean Society of Industrial and Systems Engineering
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• v.24 no.65
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• pp.11-22
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• 2001

Recently, many studies on the supply chain management have been published due to increasing attention placed on the design and performance analysis of the supply chain as a whole. Using the Beer distribution game introduced in Sterman[1995], we develop a simple order-up-to-R inventory model to minimize sum of the inventory holding cost and shortage cost under probabilistic demand. We show that performance of the model is robust through extensive simulation experiment. Applying the model to serially connected supply chain, we observe that, if the unit shortage cost is relatively high, R value computed independently is an optimal solution.

• Journal of Korean Institute of Industrial Engineers
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• v.11 no.1
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• pp.41-49
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• 1985

This paper studies the two supplier inventory system in which order-level inventory policy with constant leadtimes is adopted. An optimal ordering policy to achieve the expected minimum total inventory cost is found by utilizing the concepts of the equivalence relation. Sensitivity analysis of the system parameters, the replenishment cost and the unit price, is done through a numerical example.