Inventory rationing in an (s, Q) inventory model with lost sales and two demand classes

Inventory rationing via drop-shipping in Internet retailing: A sensitivity analysis

“…Moon and Kang [23] generalized a similar model with compound Poisson demand and examined a (R, Q) model to derive approximate expressions for the fill rates of the demand classes. Melchiors et al [21] also analyzed this model with unit Poisson demand, deterministic lead-time, and lost sales. Ha [14] used a single product M/M/1/S queue with state dependent service times to study optimality of a lot-for-lot critical level policy with n demand classes and backordering.…”

“…If there is order crossover, replenishment orders do not arrive in the sequence they are placed. Due to the intractability of models with order crossover, the literature on inventory management mostly assume that the probability of order crossover is negligible [16,21,24]. Though we can easily capture more than one outstanding order and order crossover in our model, for a possible extension of our analysis to analytical models in future work, we follow the general assumption that orders do not cross and they are received in the same sequence in which they were placed.…”

Reservation policies of advance orders in the presence of multiple demand classes

“…In finalizing this literature review we should also mention another line of research studying which sort of inventory control policies should be applied in the presence of heterogeneous demand. When examining the literature (see Topkis (1968), Evans (1968), Kaplan (1969), Frank et al (2003) andTempelmeier (2006) for periodic review models and Nahmias and Demmy (1981), Dekker et al (1998Dekker et al ( , 2002, Melchiors et al (2000), Melchiors (2003) and Deshpande et al (2003) for continuous review models) they all assume that the customer classes can be differentiated by introducing a rationing policy. A rationing policy means that low priority customers are denied access to the inventory when the on-hand level is critically low.…”

Multi-class dynamic inventory rationing with stochastic demands and backordering

“…For example, Nahmias and Demmy (1981), Cohen et al (1988), Dekker et al (1998), Moon and Kang (1998) analyzed service levels under a static rationing policy and a given ordering policy. Melchiors et al (2000) introduced an approach to evaluate the cost associated with a static threshold policy for an (R, Q) inventory model with two demand classes in a lost sales environment. Deshpande et al (2003) investigated an (R, Q) system with two demand classes and backorders, and developed an approach to optimize the static thresholds and the parameters of ordering policy.…”