The Effect of Commonality on Safety Stock in a Simple Inventory Model

Kenneth R. Baker; Michael J. Magazine; Henry L. W. Nuttle

doi:10.1287/mnsc.32.8.982

Management Science Vol. 32 No. 8 1986

The Effect of Commonality on Safety Stock in a Simple Inventory Model

Kenneth R. Baker¹; Michael J. Magazine²; Henry L. W. Nuttle³

¹ The Amos Tuck School of Business Administration, Dartmouth College, Hanover, New Hampshire 03755 · ² Department of Management Sciences, University of Waterloo, Waterloo, Ontario, Canada · ³ Department of Industrial Engineering, North Carolina State University, Raleigh, North Carolina 27695

Abstract

We examine the effects of component commonality on optimal safety stock levels in a two-product, two-level inventory model. The criterion is to minimize system safety stock subject to a service level constraint. Although our model is specialized, its analysis provides insights not available in other multilevel inventory models.

DOI: 10.1287/mnsc.32.8.982
Volume: 32
Issue: 8
Pages: 982-988
Language: en
Sources: bibtex:phds-export.bib openalex crossref

The Effect of Commonality on Safety Stock in a Simple Inventory Model

Abstract

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