Abstract
In this paper we determine optimal reduction in the procurement lead time duration for some stochastic inventory models, jointly with the optimal ordering decisions. The models are developed with complete and partial information about the lead time demand distribution. The stochastic models analyzed in this paper are the classical continuous and periodic review models with a mixture of backorders and lost sales and the base stock model. For each of these models, we provide sufficient conditions for the uniqueness of the optimal operating policy. We also develop algorithms for solving these models and provide illustrative numerical examples.
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