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Journal Article

Minimizing holding and ordering costs subject to a bound on backorders is as easy as solving a single backorder cost model

Operations Research Letters 29 (4): 187–192
Tamer Boyaci, Guillermo Gallego (2001)
Subject(s)
Product and operations management
Keyword(s)
Stochastic inventory, Service measures, Expected backorders, Waiting times
Minimizing average ordering and holding cost subject to a constraint on expected backorders has required to iteratively solve the backorder cost model with different backorder a penalty rates until the constraint is satisfied. Here we present a direct approach, that is as simple as solving a single backorder cost model.
With permission of Elsevier
Volume
29
Journal Pages
187–192