(s, S) Policies Under Continuous Review and Discrete Compound Poisson Demand
We consider inventory policies for a continuous review system with discrete compound Poisson demand, convex holding-penalty cost and fixed order cost. Beckmann has showri that under these conditions (s, S) policies are optimal. We develop recursive formulae to calculate the cost for any pair (s, S). Relations among s, S, S - s and the cost are produced that lead to an efficient determination of the optimal s and S. Tighter bounds are utilized than those obtained by Veinott and Wagner for the analogous case of periodic review. Sensitivity considerations are discussed.
Year of publication: |
1978
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Authors: | Archibald, Blyth C. ; Silver, Edward A. |
Published in: |
Management Science. - Institute for Operations Research and the Management Sciences - INFORMS, ISSN 0025-1909. - Vol. 24.1978, 9, p. 899-909
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Publisher: |
Institute for Operations Research and the Management Sciences - INFORMS |
Saved in:
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