An inventory system with multiple replenishment scheduling

The authors consider an inventory system in which more than one replenishment of an item are triggered whenever the inventory level drops to the order point or lower. By placing several firmed orders at a time, the reduction in the unit purchase cost (due to the large order quantity) and the ordering cost, along with the more ensured delivery time, usually offsets the resultant increased costs due to the unpredictability of future demand. A procedure is developed to find the delivery schedule for N replenishments that minimizes the sum of the expected holding and shortage costs.