A single supplier-single retailer system with an order-up-to level inventory policy

  • Authors:
  • OğUz Solyalı;Haldun SüRal

  • Affiliations:
  • Department of Industrial Engineering, Middle East Technical University, Ankara, Turkey;Department of Industrial Engineering, Middle East Technical University, Ankara, Turkey

  • Venue:
  • Operations Research Letters
  • Year:
  • 2008

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Abstract

We consider a two-level vendor-managed system in which external demand occurs only at a retailer and a supplier replenishes the retailer employing an order-up-to S policy over T periods. We present an O(T^3) algorithm to coordinate the system when S is known. We also show that S can be optimized in O(aT^3) time for an input parameter a.