A dynamic multi-location inventory model with contingents and redistribution of rest stock

In this paper a multi-location inventory model with redistribution is considered for the discounted cost criterion. Periodically each location gets a fixed amount of a given product. At the beginning of a period it is possible to sell some product out of the system. At the end of a period the rest stock can be redistributed for decreasing system’s cost. Unused product is lost as well as the unsatisfied demand. The paper investigates the existence and the properties of optimal selling and redistribution decisions. For the 2-location model two numerical examples have been solved.