Research Reports from the Department of Operations
Document Type
Report
Publication Date
7-1-1966
Abstract
The characteristics of a multiproduct, multiwarehouse periodic review inventory system in which interdependency between commodities and/or warehouses is introduced through set-up costs, are investigated for probabilistic demand. For a two-commodity system, the one and two period problems are analyzed. By specifying the structure of the inventory policy, the statistical properties of the system can be studied and optimal decision rules arrived at. For the stationary problem, the fundamental equation dealt with is similar to the basic renewal equation, though one is dealing rather with vector random variables. Concepts in mapping, differential and variational calculus are used in working out the optimization problem for the case when demands are independently and exponentially distributed. The results of the two-commodity problem are then extended to an m-commodity (m-warehouse) (m=1,2,...) problem.
Keywords
Operations research, Inventory control--Mathematical models, Warehouses--Management, Stochastic processes, Calculus of variations, Vector analysis, Demand (Economic theory)--Mathematical models
Publication Title
Technical Memorandums from the Department of Operations, School of Management, Case Western Reserve University
Issue
Technical memorandum no. 58
Rights
This work is in the public domain and may be freely downloaded for personal or academic use
Recommended Citation
Sivazlian, B. D., "Inventory Control of a Multiproduct System with Interacting Procurement Cost" (1966). Research Reports from the Department of Operations. 261.
https://commons.case.edu/wsom-ops-reports/261