Abstract
Four inventory replenishment policies namely: Analytical, Silver-Meal Heuristic, Alternative Heuristic and Modified EBQ are compared for the case of deterministic linearly increasing demand. Using hypothetical example, for each policy, cost penalties of ordering earlier and later than optimal replenishment times are calculated. A wide range of values for slope of demand, inventory replenishment and holding costs are considered. Shortcomings of each policy is discussed. For the case of linearly decreasing demand a new policy based on Modified EBQ is developed and compared with analytical method. Within the considered wide range of values for relevant cost and demand pattern parameters, EBQ method suitably modified for linear trend has shown very good performance.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Preview
Unable to display preview. Download preview PDF.
References
Brosseau, L.J.A., An Inventory Replenishment Policy for the case of a Linear Decreasing Trend in Demand, INFOR, Vol.. 20, No. 3, August 1982, 252–257.
Buchanan, J.T., Alternative Solution Method for the Inventory Replenishment Problem Under Increasing Demand, J. Opl. Res. Soc., 31 (1980), 616–620.
Diegel, A., Economic Lots Under Linearly Changing Consumption: with Tables, unpublished DNA thesis, School of Business Administration, University of Oregon, Portland.
Donaldson, W.A., Inventory Replenishment Policy for a Linear Trend in Demand–An Analytical Solution, Opl. Res. Q., 1977, Vol. 28, 3, 663–670.
Kotler, P., Marketing Management* Analysis, Planning, and Control, ( Fifth edition, Prentice Hall International Edition, London, 1984 ), 358.
Ritchie, E., Practical Inventory Replenishment Policies for a Linear Trend in Demand followed by a Period of Steady Demand, J. Opl. Res. Soc., 31 (1980), 605–613.
Silver, E.A., A Simple Inventory Replenishment Decision Rule for a Linear Trend in Demand, J. Opl. Res. Soc., 30 (1980), 71–75
Silver, E.A., Vidal, R., Victor, V., and Werra, D., A Tutorial on Heuristic Methods, European Journal of Operational Research, 5 (1980), 153–162
Author information
Authors and Affiliations
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 1985 Springer-Verlag Berlin Heidelberg
About this paper
Cite this paper
Tabucanon, M.T., Farahani, M.V. (1985). Solution Techniques for Inventory Replenishment Policies with Linear Demand Trend. In: Bullinger, HJ., Warnecke, H.J. (eds) Toward the Factory of the Future. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-82580-4_56
Download citation
DOI: https://doi.org/10.1007/978-3-642-82580-4_56
Publisher Name: Springer, Berlin, Heidelberg
Print ISBN: 978-3-642-82582-8
Online ISBN: 978-3-642-82580-4
eBook Packages: Springer Book Archive