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A statistical comparison of two safety stock replenishment mechanisms in a cyclic stochastic IRP

Ehsan Yadollahi (UGent) , El-Houssaine Aghezzaf (UGent) and Birger Raa (UGent)
(2016) IFAC-PapersOnLine - sciencedirect. 49(12). p.1508-1513
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Abstract
Preventing stock-out in a replenishment system, in which customer demand rates are stochastic with constant averages, can be accomplished via safety stocks hold at each customer. These safety stocks should be replenished back to their initial levels each time they are used. However, sometimes it occurs that a truck does not have enough capacity to carry the amount of the product the visited customers need to restore their stocks and safety stocks to their required levels. Therefore, the carried extra amount of the product, intended to replenish safety stocks, should be divided amongst the customers in some optimal or fair manner. To achieve this fair allocation, we propose and analyze two policies, the first called Fair-share and the second Ratio methods. Details on how these two methods are implemented, to achieve the level of service expected at each customer, are discussed and illustrated. In addition a simulation model is developed and used to compare the performance of each policy in the long run.
Keywords
Safety Stock, Backlog, Fair-Share, Inventory Routing Problem, Service Level, Simulation

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MLA
Yadollahi, Ehsan, et al. “A Statistical Comparison of Two Safety Stock Replenishment Mechanisms in a Cyclic Stochastic IRP.” IFAC-PapersOnLine - Sciencedirect, edited by Alexandre Dolgui et al., vol. 49, no. 12, IFAC-PapersOnLine - sciencedirect, Elsevier, 2016, pp. 1508–13.
APA
Yadollahi, E., Aghezzaf, E.-H., & Raa, B. (2016). A statistical comparison of two safety stock replenishment mechanisms in a cyclic stochastic IRP. In A. Dolgui, R. Grubbström, D. Ivanov, & F. Yalaouil (Eds.), IFAC-PapersOnLine - sciencedirect (Vol. 49, pp. 1508–1513). Troyes, France: IFAC-PapersOnLine - sciencedirect, Elsevier.
Chicago author-date
Yadollahi, Ehsan, El-Houssaine Aghezzaf, and Birger Raa. 2016. “A Statistical Comparison of Two Safety Stock Replenishment Mechanisms in a Cyclic Stochastic IRP.” In IFAC-PapersOnLine - Sciencedirect, edited by Alexandre Dolgui, Robert Grubbström, Dmitry Ivanov, and Farouk Yalaouil, 49:1508–13. IFAC-PapersOnLine - sciencedirect, Elsevier.
Chicago author-date (all authors)
Yadollahi, Ehsan, El-Houssaine Aghezzaf, and Birger Raa. 2016. “A Statistical Comparison of Two Safety Stock Replenishment Mechanisms in a Cyclic Stochastic IRP.” In IFAC-PapersOnLine - Sciencedirect, ed by. Alexandre Dolgui, Robert Grubbström, Dmitry Ivanov, and Farouk Yalaouil, 49:1508–1513. IFAC-PapersOnLine - sciencedirect, Elsevier.
Vancouver
1.
Yadollahi E, Aghezzaf E-H, Raa B. A statistical comparison of two safety stock replenishment mechanisms in a cyclic stochastic IRP. In: Dolgui A, Grubbström R, Ivanov D, Yalaouil F, editors. IFAC-PapersOnLine - sciencedirect. IFAC-PapersOnLine - sciencedirect, Elsevier; 2016. p. 1508–13.
IEEE
[1]
E. Yadollahi, E.-H. Aghezzaf, and B. Raa, “A statistical comparison of two safety stock replenishment mechanisms in a cyclic stochastic IRP,” in IFAC-PapersOnLine - sciencedirect, Troyes, France, 2016, vol. 49, no. 12, pp. 1508–1513.
@inproceedings{8055652,
  abstract     = {Preventing stock-out in a replenishment system, in which customer demand rates are stochastic with constant averages, can be accomplished via safety stocks hold at each customer. These safety stocks should be replenished back to their initial levels each time they are used. However, sometimes it occurs that a truck does not have enough capacity to carry the amount of the product the visited customers need to restore their stocks and safety stocks to their required levels. Therefore, the carried extra amount of the product, intended to replenish safety stocks, should be divided amongst the customers in some optimal or fair manner. To achieve this fair allocation, we propose and analyze two policies, the first called Fair-share and the second Ratio methods. Details on how these two methods are implemented, to achieve the level of service expected at each customer, are discussed and illustrated. In addition a simulation model is developed and used to compare the performance of each policy in the long run.},
  author       = {Yadollahi, Ehsan and Aghezzaf, El-Houssaine and Raa, Birger},
  booktitle    = {IFAC-PapersOnLine - sciencedirect},
  editor       = {Dolgui, Alexandre and Grubbström, Robert and Ivanov, Dmitry and Yalaouil, Farouk},
  issn         = {2405-8963},
  keywords     = {Safety Stock,Backlog,Fair-Share,Inventory Routing Problem,Service Level,Simulation},
  language     = {eng},
  location     = {Troyes, France},
  number       = {12},
  pages        = {1508--1513},
  publisher    = {IFAC-PapersOnLine - sciencedirect, Elsevier},
  title        = {A statistical comparison of two safety stock replenishment mechanisms in a cyclic stochastic IRP},
  url          = {http://dx.doi.org/10.1016/j.ifacol.2016.07.785},
  volume       = {49},
  year         = {2016},
}

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