Note on Inventory Model with Reorder Point as a Decision Variable

10.6186/IJIMS.201806_29(2).0005

Jones Pi-Chang Chuang；Scott Shu-Cheng Lin；Peterson Ventriloquist

Reordered point ； safety factor ； inventory

International Journal of Information and Management Sciences

29卷2期（2018 / 06 / 01）

221 - 233

英文

We examine Horowitz and Daganzo (1986) to provide a patch work such that researchers can realize their paper as the first article to treat the reorder point as a decision variable for inventory models with stochastic lead time. However, only seven papers had cited their papers in their references. We may claim that (a) Their derivations contains tedious verification, (b) They adopted a graphical method only search less than fifty percent of the possible domain and (c) They did not show that within their shrunk sub-domain, the existence and uniqueness of their approximated optimal solution that result in these few citations. Our improvements include (i) A clear derivation after they reduced to one variable problem, (ii) An analytical procedure to shrink the searching domain to 91%, and (iii) Within our shrunk sub-domain, we prove the existence and uniqueness of our exact optimal solution.

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