Optimal Replenishment Policies for Multiechelon Inventory Problems Under Advance Demand Information

@article{Gallego2003OptimalRP,
  title={Optimal Replenishment Policies for Multiechelon Inventory Problems Under Advance Demand Information},
  author={Guillermo Gallego and {\"O}zalp {\"O}zer},
  journal={Manufacturing & Service Operations Management},
  year={2003},
  volume={5},
  pages={157-175}
}
Customers and downstream supply chain partners often place, or can be induced to place, orders in advance of future requirements. We show how to optimally incorporate advance demand information into periodic-review, multiechelon, inventory systems in series. While the state space for series systems appears to be formidably large, we decompose the problem across locations, as in Clark and Scarf (1960), and reduce the state space at each location by using modified echelon inventory positions… CONTINUE READING

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