Multi-item spare parts systems with lateral transshipments and waiting time constraints |
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| Affiliation: | 1. Katholieke Universitèit Leuven, Centre for Industrial Management, Celestijnenlaan 300A, 3001 Heverlee, Belgium;2. Technische Universiteit Eindhoven, Faculty of Technology Management, P.O. Box 513, 5600 MB Eindhoven, The Netherlands;1. Vilnius Gediminas Technical University, Sauletekio st 11, Vilnius, Lithuania;2. DIKU - Department of Computer Science, University of Copenhagen, Universitetsparken 1, DK-2100 Copenhagen, Denmark;1. Otto-von-Guericke-University Magdeburg, Faculty of Economics and Management, Management Science, P.O. Box 4120, 39016 Magdeburg, Germany;2. Department of Industrial & Systems Engineering, University of Florida, 303 West Hall, Gainesville, FL 32611-6595, USA;3. Department of Industrial Engineering, Bogaziçi University, 34342, Bebek-Istanbul, Turkey;4. Koç University, Department of Industrial Engineering, 34450 Sariyer-Istanbul, Turkey;5. University of Vienna, Department of Management Science, Bruenner Strasse 72, 1210 Vienna, Austria;1. Department of Management Sciences, University of Waterloo, Waterloo, Ontario, Canada;2. Frontline Systems, Inc., Incline Village, NV, USA;3. School of Management, Sabanci University, Istanbul, Turkey;1. Faculty of Industrial Engineering and Management, Technion – Israel Institute of Technology, Haifa, Israel;2. Department of Industrial Engineering, Tel-Aviv University, Tel-Aviv, Israel;1. Masdar Institute of Science and Technology, Abu Dhabi, United Arab Emirates;2. University of Waterloo, Waterloo, Ontario, Canada N2L 3G1 |
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| Abstract: | This paper deals with the analysis of a multi-item, continuous review model of two-location inventory systems for repairable spare parts, used for expensive technical systems with high target availability levels. Lateral and emergency shipments occur in response to stockouts. A continuous review basestock policy is assumed for the inventory control of the spare parts. The objective is to minimize the total costs for inventory holding, lateral transshipments and emergency shipments subject to a target level for the average waiting time per demanded part at each of the two locations. A solution procedure based on Lagrangian relaxation is developed to obtain both a lower bound and an upper bound on the optimal total cost. The upper bound follows from a heuristic solution. An extensive numerical experiment shows an average gap of only 0.31% between the lower and upper bounds. The experiment also gives insights into the relative improvement achieved by applying lateral transshipments and or the system approach. We also apply the proposed model to actual data from an air carrier company. |
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