Heuristics for assessing emergency transshipments

It is not uncommon for organizations with multiple stock-keeping facilities to have some locations facing shortages while others have excess inventory. This paper examines emergency transshipments of product as an approach to solve this problem. Specifically, two heuristics are developed to assist managers in determining when stock transfers should be made. The heuristics produce critical values for on-hand inventory levels above which transshipments minimize overall expected costs. They also provide insight into the factors affecting transshipment usage.