| Article ID: | iaor2014918 |
| Volume: | 79 |
| Issue: | 3 |
| Start Page Number: | 293 |
| End Page Number: | 326 |
| Publication Date: | Jun 2014 |
| Journal: | Mathematical Methods of Operations Research |
| Authors: | Rambau Jrg, Schade Konrad |
| Keywords: | simulation, combinatorial optimization, inventory: order policies, demand |
The guaranteed service model (GSM) computes optimal order‐points in multi‐echelon inventory control under the assumptions that delivery times can be guaranteed and the demand is bounded. Our new stochastic guaranteed service model (SGSM) with Recourse covers also scenarios that violate these assumptions. Simulation experiments on real‐world data of a large German car manufacturer show that policies based on the SGSM dominate GSM‐policies.