Title: On the viability of partial inventory pooling

Authors: Yigal Gerchak

Addresses: Department of Industrial Engineering, Tel-Aviv University, Tel-Aviv 69978, Israel

Abstract: When demands are uncertain, complete inventory pooling is known to be a better strategy than no pooling if the trans-shipment cost is low enough; otherwise, pooling is undesirable. But are there situations where pooling some inventories, but not the rest, in a central warehouse, are the best strategy? We show that such is indeed the case for certain demand distributions and cost parameter values. We show it for a symmetric discrete demand scenario, as well as for a symmetric continuous demand scenario.

Keywords: inventory pooling; trans-shipment; partial pooling.

DOI: 10.1504/IJIR.2017.085354

International Journal of Inventory Research, 2017 Vol.4 No.1, pp.44 - 60

Received: 23 Sep 2016
Accepted: 03 Nov 2016
Published online: 24 Jul 2017 *

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