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A comparative study of VMI replenishment policies – toward rule-based decision making based on Monte Carlo simulations

A comparative study of VMI replenishment policies – toward rule-based decision making based on... This paper discusses a few different replenishment policies for suppliers who practice Vendor Managed Inventory (VMI) with their retailer customer. The relationship between the supplier overall cost and replenishment decision variables are explored through Monte Carlo simulation coupled with sensitivity analysis. The advantage of the proposed dynamic (s, S) policy is demonstrated through parallel cost comparison of the different replenishment policy schemes. This paper also discusses the application of dynamic (s, S) replenishment policy in the scenario of perishable goods and in the scenario of supply chain process with long lead time. It presents the decision rules for applying the dynamic (s, S) policy and also points out the inappropriateness of certain policies under VMI setting. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png International Journal of Services Operations and Informatics Inderscience Publishers

A comparative study of VMI replenishment policies – toward rule-based decision making based on Monte Carlo simulations

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References (9)

Publisher
Inderscience Publishers
Copyright
Copyright © Inderscience Enterprises Ltd. All rights reserved
ISSN
1741-539X
eISSN
1741-5403
DOI
10.1504/IJSOI.2009.021743
Publisher site
See Article on Publisher Site

Abstract

This paper discusses a few different replenishment policies for suppliers who practice Vendor Managed Inventory (VMI) with their retailer customer. The relationship between the supplier overall cost and replenishment decision variables are explored through Monte Carlo simulation coupled with sensitivity analysis. The advantage of the proposed dynamic (s, S) policy is demonstrated through parallel cost comparison of the different replenishment policy schemes. This paper also discusses the application of dynamic (s, S) replenishment policy in the scenario of perishable goods and in the scenario of supply chain process with long lead time. It presents the decision rules for applying the dynamic (s, S) policy and also points out the inappropriateness of certain policies under VMI setting.

Journal

International Journal of Services Operations and InformaticsInderscience Publishers

Published: Jan 1, 2009

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