New structural properties of (s,S) policies for inventory models with lost sales

Authors:
Yanyi Xu;Arnab Bisi;Maqbool Dada
Affiliations:
School of Management, Shanghai University, Shanghai, 200444, China;Krannert School of Management, Purdue University, West Lafayette, IN 47907, USA;Johns Hopkins Carey Business School, Baltimore, MD 21201, USA
Venue:
Operations Research Letters
Year:
2010

Citing 3
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Abstract

We revisit the classical inventory model for which (s,S) policies are optimal. We consider the finite and infinite horizon versions of the lost sales problem. New structural properties are developed for the optimal policy and cost function. These properties are then used to develop computational schemes for the lost sales problem with Erlang demands.