On the estimation of the fill rate for the continuous (s, S) inventory system for the lost sales context.

ABSTRACT: In the continuous review reorder point, base-stock (s, S) policy, the replenishment order is launched when the inventory position reaches the reorder point, s. It is commonly assumed that the inventory position is exactly equal to the reorder point at the moment the order is launched, when actually it could be lower at that moment. This implies neglecting the possible undershoots at the reorder point, which has a direct impact on the calculation of the expected shortages per replenishment cycle. This article presents a method for an exact calculation of the fill rate (fraction of demand that is immediately satisfied from shelf) which takes explicit account of the existence of undershoots and is applicable to any discrete demand distribution function in a context of lost sales. This method

SUBMITTER: Guijarro E 

PROVIDER: S-EPMC8853522 | biostudies-literature | 2022

REPOSITORIES: biostudies-literature