Scandinavian Working Papers in Business Administration
CORAL Working Papers,
University of Aarhus, Aarhus School of Business, Department of Business Studies
No L-2006-03: Computation of order and volume fill rates for a base stock inventory control system with heterogeneous demand to investigate which customer class gets the best service
Christian Larsen ()
Additional contact information
Christian Larsen: Department of Business Studies, Postal: The Aarhus School of Business, Fuglesangs Allé 4, 8210 Aarhus V, Denmark
Abstract: We consider a base stock inventory control system serving two customer classes whose demands are generated by two independent compound renewal processes. We show how to derive order and volume fill rates of each class. Based on assumptions about first order stochastic dominance we prove when one customer class will get the best service. That theoretical result is validated through a series of numerical experiments which also reveal that it is quite robust.
Keywords: Base stock policy; service measures; two customer classes; compound renewal processes
25 pages, March 6, 2006
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L_2006_03.pdf
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