Cost-Based Filtering Techniques for Stochastic Inventory Control Under Service Level Constraints

TARIM Ş. A. , HNİCH B., Rossi R. , Prestwich S.

CONSTRAINTS, vol.14, no.2, pp.137-176, 2009 (Journal Indexed in SCI) identifier identifier

  • Publication Type: Article / Article
  • Volume: 14 Issue: 2
  • Publication Date: 2009
  • Doi Number: 10.1007/s10601-007-9039-3
  • Title of Journal : CONSTRAINTS
  • Page Numbers: pp.137-176


This paper(1) considers a single product and a single stocking location production/inventory control problem given a non-stationary stochastic demand. Under a widely-used control policy for this type of inventory system, the objective is to find the optimal number of replenishments, their timings and their respective order-up-to-levels that meet customer demands to a required service level. We extend a known CP approach for this problem using three cost-based filtering methods. Our approach can solve to optimality instances of realistic size much more efficiently than previous approaches, often with no search effort at all.