Risk pooling approach in multi-product multi-period inventory control model under uncertainty

Risk pooling is an approach which is majorly supportive for maintaining the safety stock up to a minimum level under uncertain conditions. This pooling method decreases the inventory carrying costs, overhead costs and other costs involved in maintain the facility, Therefore this approach can be suitably implemented in an inventory control model. The major concentration of this study is to develop a multi-product multi-period inventory control model in two stage supply chain network which mainly consists of distributors and retailers. Inventory carrying costs, transportation costs, facility operating cost, ordering costs and facility cost are incorporated for the formulation of inventory control model in objective function under various constraints. A non-linear programming has been originated to solve the proposed mathematical model. The results and the performance parameters can be assessed under various uncertain levels.

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