Motivated by real life, we introduce a new inventory model for spare parts where we
explicitly take delivery time requirements into account. In this single-echelon, multilocation
network, demand of a customer can be satisfied from multiple warehouses,
but only if the customer can be reached from a warehouse within a time limit that is
specified in the service contract of the customer. A delivery to a customer from a warehouse other than the closest one is referred to as a lateral transshipment. We develop
a fast and accurate approximate algorithm to evaluate the performance of the network
under given base stock levels and propose a fast and effective heuristic to set base stock
levels. Numerical experiments show that planning with lateral transshipments can lead
to cost savings up to 47% when compared to planning without lateral transshipments.
Furthermore, we show the importance of taking lateral transshipments into account
when designing a spare parts network.
|Place of Publication||Eindhoven|
|Publisher||Technische Universiteit Eindhoven|
|Number of pages||26|
|Publication status||Published - 2009|
|Name||BETA publicatie : working papers|