A stochastic multi-item inventory model with unequal replenishment intervals and limited warehouse capacity

Managing inventory levels for multiple products that share warehouse capacity often presents significant coordination challenges. These coordination challenges are further compounded when multiple suppliers use different replenishment schedules for supplying the warehouse. To address these challenges, this paper studies stochastic inventory models for multiple items with both equal and unequal replenishment intervals under limited warehouse capacity. We propose three efficient and intuitively attractive heuristics. We show that these heuristics provide the optimal replenishment quantities in the case of equal replenishment intervals. For the general model, a numerical comparison of the heuristic solutions to the optimal solutions shows that the heuristics yield high quality solutions in very limited time.

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