Simulation-Based Approach for Comparison of (s, Q) and (R, S) Replenishment Policies Utilization Efficiency in Multi-echelon Supply Chains

Abstract

Cyclic and non-cyclic planning methods are traditionally used in the multi-echelon supply chains. However, the utilization rules and efficiency of these methods so far have been investigated partially. The aim of the paper is to evaluate utilization efficiency of two types of inventory policies, i.e. so called (s, Q) and (R, S) ones, in multi-echelon supply chain. In this paper the simulation-based approach for estimation of two observed inventory policies within multi-echelon supply chain is presented. The comparison is based on costs analysis of alternatives. The influence of different parameters i.e. coefficient of demand variation (CODVAR), capacity utilization and number of echelons, is described. The numerical examples are given for three - echelon linear supply chain.