Testing the Cost Effectiveness of an Inventory Filtering Rule Using Empirical Data.
NORTH CAROLINA UNIV AT CHAPEL HILL SCHOOL OF BUSINESS ADMINISTRATION
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In this report we evaluate the cost effectiveness of an inventory filtering rule shown in Technical Report 22. We use United States Air Force empirical individual customer order distributions to generate 1080 cases. We compare the operating characteristics of the inventory replenishment policy for the unfiltered orders to the policy for the filtered orders. We show that filtering can significantly reduce total expected costs, with the majority of reduction resulting from decreased inventory investment. Author
- Economics and Cost Analysis
- Statistics and Probability
- Logistics, Military Facilities and Supplies