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Authors: Benedikt De Vos and Birger Raa

Affiliation: Ghent University, Belgium

Keyword(s): Supply Chain Collaboration, Lateral Transshipments, Inventory Control, Inventory-routing.

Abstract: This paper considers a two-stage distribution system consisting of a supplier supplying several retailers with stochastic demand rates. Replenishments by the supplier happen cyclically, based on average retailer demand rates. Hence, the considered distribution problem between the suppliers and its retailers is a Cyclic Inventory Routing Problem (CIRP), which we solve with a state-of-the-art heuristic solution method. To cope with the demand stochasticity, lateral transshipments can happen between retailers in each time period. We propose a redistribution policy that determines the quantities being redistributed through lateral transshipments based on the desired level of customer service the retailers want to reach (using the desired fill rate) and their actual inventory levels. The cost of the daily redistribution is determined by solving a Travelling Salesman Problem (TSP) covering the participating retailers. The potential benefits of the collaboration among retailers are analyzed by comparing the distribution costs, the redistribution costs, the inventory holding costs and the costs of lost sales at the retailers in different scenarios. (More)

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Paper citation in several formats:
De Vos, B. and Raa, B. (2018). Tackling Demand Stochasticity by Redistribution among Retailers in a Two-stage Distribution System. In Proceedings of the 7th International Conference on Operations Research and Enterprise Systems - ICORES; ISBN 978-989-758-285-1; ISSN 2184-4372, SciTePress, pages 232-238. DOI: 10.5220/0006623202320238

@conference{icores18,
author={Benedikt {De Vos} and Birger Raa},
title={Tackling Demand Stochasticity by Redistribution among Retailers in a Two-stage Distribution System},
booktitle={Proceedings of the 7th International Conference on Operations Research and Enterprise Systems - ICORES},
year={2018},
pages={232-238},
publisher={SciTePress},
organization={INSTICC},
doi={10.5220/0006623202320238},
isbn={978-989-758-285-1},
issn={2184-4372},
}

TY - CONF

JO - Proceedings of the 7th International Conference on Operations Research and Enterprise Systems - ICORES
TI - Tackling Demand Stochasticity by Redistribution among Retailers in a Two-stage Distribution System
SN - 978-989-758-285-1
IS - 2184-4372
AU - De Vos, B.
AU - Raa, B.
PY - 2018
SP - 232
EP - 238
DO - 10.5220/0006623202320238
PB - SciTePress

- Science and Technology Publications, Lda.
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