A robust inventory routing policy under inventory inaccuracy and replenishment lead-time

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A robust inventory routing policy under inventory inaccuracy and replenishment lead-time

Li, Ming / Wang, Zheng / Chan, Felix T.S.

Highlights • Model an inventory routing problem under replenishment lead time and inventory inaccuracy. • Propose the methods of updating the probability of the current inventory level and predicting those in future periods. • Develop a Robust TQL Algorithm to optimize the replenishment time, replenishment quantity and replenishment stage length.

Abstract In this paper, we study an inventory routing problem under replenishment lead-time and inventory inaccuracy, which exist extensively in distribution systems for fresh products, but are often ignored in existing research. To solve the problem, a robust inventory routing policy is developed in three steps. At first, we propose the methods of updating the probability of the current net inventory and predicting those in future periods. For each candidate route, we develop a Robust TQL Algorithm to optimize the replenishment time, replenishment quantity and replenishment stage length. Finally, a genetic algorithm-based method is developed to optimize the delivery route.