Analysis of a Continuous Review Stock-control Model with Multiple Suppliers

This paper analyses the use of multiple suppliers to replenish one stock item. The replenishment order is split into several portions, one for each supplier, and orders for these portions are placed simultaneously with the respective suppliers. Approximate expressions are derived for the mean and variance of the effective lead time, which is the minimum of the individual lead times of each supplier. These results give effective lead-time-demand mean and variance that are smaller than those of the individual suppliers. The results can be used to lower the operating cost of the stocking policy.