Echelon-based inventory systems

Echelon-based inventory systems. Consider next an echelon-based inventory system with a single decision-maker, that applies the base stock levels (10.27). For this setting Aviv (2002a) shows the following... 

Echelon-based inventory systems Cost analysis... 

In this section we describe a way for finding the pair of safety-stock parameters 7 and 7, that minimize the long-run average total supply chain cost. We assume that installation-based policies are used. The extension of the discussion to echelon-based policies is relatively easy, given the observations made in 6.1.2. We refer to a supply chain in which these optimal safety stocks are used, as a coordinated two-level inventory system. We assume that h < and set = 0. Aviv (2002b) shows the following ... 

Chiang, W.K. and G.E. Monahan, The Impact Of The Web-Based Direct Channel On Supply Chain Flexibility In A Two-Echelon Inventory System, Working Paper, University of Maryland, Baltimore County, 2002. 

Saberi, S., Nookabadi, A.S., Hejazi, S.R. Applying agent-based system and negotiation mechanism in improvement of inventory management and customer order fidfilment in multi echelon supply chain. Arab. J. Sci. Eng. 37(3), 851-861 (2012)... 

In this section we determine approximative estimates of the downtime costs. We first estimate the waiting time for spare parts. Based on the estimated waiting time, we estimate the fraction of time that each functional group has a certain mnnber of defective equipment. This approximate analysis of the system is based on the analysis of multi echelon inventory control for recoverable items in the METRIC model (Sherbrooke 1968). Based on these average long term time fractions, we can calculate the long term average downtime costs in the system. 

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