Optimization framework of multi-echelon inventory system for spare parts

Abstract

Optimization of stock strategies for complex multi-echelon inventory system is a mission impossible for analytic methods. Therefore, a framework of integrating discrete event simulation with genetic algorithm is put forward. Simulation algorithm of multi-echelon stochastic inventory system with lateral transshipment is built based on discrete event simulation. Performance measure of multi-echelon inventory system is obtained through simulation. Genetic algorithm is integrated with simulation to search optimal inventory strategy and control parameters. As for other assumptions of multi-echelon inventory system, feasibility of the framework is also discussed. Numerical experiments show the validity of the framework.