An important issue in the management of supply chains and manufacturing systems is to control inventory costs at different locations throughout the system while satisfying an end-customer service-level requirement. The challenge involved is to solve a nonlinear constrained optimization problem...

This paper develops a new model for studying multiechelon inventory systems with stochastic demand. For the model we assume that each site in the system orders at preset times according to an order-up-to policy, that delivery times are deterministic, and that the demand processes are stochastic...