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An Integrated Location/Inventory Model
Problem ,[object Object]
Traditional Models ,[object Object],[object Object],[object Object],[object Object],[object Object]
Outline ,[object Object],[object Object]
Model Structure
Problem ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Problem ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Costs and Inputs N(  i ,  i 2 ) Working Inventory Safety Stock Inventory Customer Set Customer served by another DC Transport Cost Fixed Volume dependent (constant + mileage related) Lead time Fixed Cost Transport Cost
Key Issues ,[object Object],[object Object],[object Object]
If we knew customer set … ,[object Object]
Inventory at DC Time Inventory Safety Stock Reorder Point Lead Time Lead Time Reorder Size Reorder Size Reorder Size
Inventory Costs ,[object Object],[object Object]
Order Frequency,  n ,[object Object],[object Object]
With Linear Transport Costs… And…
Key Point ,[object Object],[object Object]
Decision Variables
Additional Notation
Model Form Fixed + local delivery +  volume based ship to DC But only to open DCs Each demand assigned Working inventory, (transport to DC), Safety stock Integrality

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An Integrated Location Inventory Model