| Article ID: | iaor20051662 |
| Country: | Netherlands |
| Volume: | 33 |
| Issue: | 3 |
| Start Page Number: | 285 |
| End Page Number: | 288 |
| Publication Date: | May 2005 |
| Journal: | Operations Research Letters |
| Authors: | Klijn Flip, Slikker Marco |
| Keywords: | inventory, organization |
We study a location-inventory model to analyze the impact of consolidation of distribution centers on facility and inventory costs. We introduce a cooperative game and show that when the demand processes are i.i.d. the core is non-empty, i.e., consolidation allows for a stable division of the minimal costs.