We investigate a periodic-review inventory system for a single item with stochastic demand and random yield. Since the optimal policy for such a system is complicated, we study the class of stationary linear-inflation policies where orders are only placed if the inventory position is below a...

More and more supply chains emerge that include a return flow of materials. Many original equipment manufacturers are nowadays engaged in the remanufacturing business. In many process industries, production defectives and by-products are reworked. These closed-loop supply chains deserve special...

Schering spends considerable effort to undertake product recovery activities in pharmaceutical production. The two main recovery activities are by-product recycling and solvent reuse. The main driver for engaging in these activities is economical. Recovery leads to annual savings of...

The traditional way of procurement, using long-term contract and capacity reservation, is competing with the escalating global spot market. Considering the variability of the spot prices, the flexibility of combined sourcing can be used to benefit from occasional low short-term spot price levels...

Among both inventory theorists and practitioners, it is common use to include an opportunity cost rate in the holding cost rate. In that way, the cost of capital can be roughly incorporated in an average cost (AC) inventory model. The traditional way for calculating the opportunity cost rate is...

This contribution focuses on the cost-effective management of the combined use of two procurement options: the short-term option is given by a spot market with random price, whereas the long-term alternative is characterized by a multi period capacity reservation contract with fixed purchase...