| Article ID: | iaor20062444 |
| Country: | Netherlands |
| Volume: | 34 |
| Issue: | 3 |
| Start Page Number: | 257 |
| End Page Number: | 263 |
| Publication Date: | May 2006 |
| Journal: | Operations Research Letters |
| Authors: | Ommeren J.C.W. van, Gabor A.F. |
| Keywords: | demand, inventory, stochastic processes |
We propose a 2-approximation algorithm for a facility location problem with stochastic demands. At open facilities, inventory is kept such that arriving requests find a zero inventory with (at most) some pre-specified probability. Costs incurred are expected transportation costs, facility operating costs and inventory costs.