Simulation model for the management of a multi-echelon repairable item inventory system

A lot of multi-echelon inventory models for repairable items have been developed for three decades ago. However, even the most recent models have restrictions to their application. To focus some of those restrictions a simulation model is developed in this paper. The model is based on Díaz and Fu (1997) and represents a two-echelon inventory system, one base and one depot, for repairable items whose repair takes place, only, at the depot. At the base, a limited number of working items and a Poisson failure process are assumed. At the depot, a limited repair capacity and an exponential distributed repair time is considered. Two random variables are characterized, the number of failure items at the base waiting for the transport to the depot, N1, and the number of failure items in the repair facility, N2. A negative binomial distribution is used to describe the variables N1 + N2. The simulation model results are compared to the ones presented by Díaz and Fu.