|Start Page Number:||854|
|End Page Number:||875|
|Publication Date:||Aug 2017|
|Journal:||Mathematics of Operations Research|
|Authors:||Rapine Christophe, Stauffer Gautier, Gayon Jean-Philippe, Massonnet Guillaume|
|Keywords:||retailing, inventory, control, combinatorial optimization, programming: multiple criteria|
We consider a well‐studied multi‐echelon (deterministic) inventory control problem, known in the literature as the one‐warehouse multi‐retailer (OWMR) problem. We propose a simple and fast 2‐approximation algorithm for this NP‐hard problem, by recombining the solutions of single‐echelon relaxations at the warehouse and at the retailers. We then show that our approach remains valid under quite general assumptions on the cost structures and under capacity constraints at some retailers. In particular, we present the first approximation algorithms for the OWMR problem with nonlinear holding costs, truckload discount on procurement costs, or with capacity constraints at some retailers. In all cases, the procedure is purely combinatorial and can be implemented to run in low polynomial time.