Proposal of reorder point satisfying allowable shortage rate under limited demand information

Yasuhiko Takemoto, Fumie Iwamoto, Ikuo Arizono

Research output: Contribution to journalArticle

1 Citation (Scopus)

Abstract

The conventional reorder point system has been studied by many researchers, and is still an important issue in inventory management. In the continuous review system, the reorder point is set as an inventory level so that the shortage rate during the procurement lead time becomes less than or equal to the specified allowable level. The conventional design of the reorder point is based on the assumption that demand follows a normal distribution. However, this assumption is not always appropriate. In this study, the design of the reorder point using the limited demand information is proposed.

Original languageEnglish
Pages (from-to)21-24
Number of pages4
JournalJournal of Japan Industrial Management Association
Volume62
Issue number1
Publication statusPublished - Apr 15 2011
Externally publishedYes

Keywords

  • Allowable shortage rate
  • Limited demand information
  • Reorder point system

ASJC Scopus subject areas

  • Strategy and Management
  • Management Science and Operations Research
  • Industrial and Manufacturing Engineering
  • Applied Mathematics

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