15th International Symposium on Inventories, Budapest, Macaristan, 22 - 26 Ağustos 2008, ss.133
BATCH ORDERING PROBLEM IN MULTI ITEM TWO ECHELON SPARE PARTS INVENTORY CONTROL SYSTEMS Engin Topan, Zeynep Pelin Bayindir, Tarkan Tan
In this study we deal with a multi-item two-echelon spare parts inventory control system in
which the central warehouse operates with reorder point/order quantity (Q,R) policy whereas
local warehouses implements one-for-one replenishment. In this environment we study the
batch ordering problem of the corresponding system. There are two common approaches in
determining policy parameters. One approach is the sequential approach in which the order
sizes are determined at first, in most cases by EOQ-rule, then given the order sizes, the
reorder level for the central warehouse and the basestock levels for the local warehouses are
determined. The other approach is the simultaneous approach in which all the control
parameters of the system including the order size are optimized simultaneously. The former
one is suboptimal, but due to its simplicity, very common in the spare parts business. One
aim of this study is to test the performances of the sequential approach and the
simultaneous approach in a multi-item setting. In order to accomplish this goal we need an
exact solution procedure for the problem. The second aim of this study is to propose an exact
solution procedure for the problem. The procedure is based on using the Lagrangean dual
bound in a branch and bound procedure. Later this solution procedure is used to test the
performances of the sequential approach and the simultaneous approach. By doing so, we
hope to evaluate the value of “optimal solution” of batch ordering problem in a multi item
two-echelon distribution system