When inventory replenishments can arrive in a different sequence than the one in which they were placed, it is important to use the shortfall distribution to set the base-stock level. Because the exact shortfall distribution is quite difficult to compute, heuristics are commonly used in its...

Order crossovers occur when replenishment orders arrive in a sequence that is different than the one in which they were placed. Order crossovers require that optimal reorder levels be set with regard to the inventory shortfall distribution rather than the lead-time demand distribution. Assuming...

Order crossover occurs whenever replenishment orders do not arrive in the sequence in which they were placed. This paper argues that order crossover is becoming more prevalent and analyzes the dangers of ignoring it. We present an exact iterative algorithm for computing the distribution of the...