Home   >   CSC-OpenAccess Library   >    Manuscript Information
Inventory Control in Supply Chain Through Lateral Transshipment – A Case Study in Indian Industry
Dharamvir Mangal, Pankaj Chandna
Pages - 443 - 457     |    Revised - 30-10-2009     |    Published - 30-11-2009
Volume - 3   Issue - 5    |    Publication Date - November 2009  Table of Contents
Inventory Control, Supply Chain Management, Lateral Transshipment
Supply chain management emphasizes collaborative relationships between supply chain members. The purpose of this work is to examine the antecedents of retailer - retailer partnership and to explore its impact on the supply chain performance. We consider coordination among stocking locations through replenishment strategies that take explicitly into consideration transshipments, transfer of a product among locations at the same echelon level. A continuous review inventory system has been adopted, in which lateral transshipments are allowed. In general, if a demand occurs at a location and there is no stock on hand, the demand is assumed to be backordered or lost. Lateral transshipments serve as an emergency supply in case of stock out and the rule for lateral transshipments is to always transship when there is a shortage at one location and stock on hand at the other. The aim is to explore the role of lateral transshipment to control inventory and associated cost within supply chain and, from this, to develop an exploratory framework that assists understanding in the area. A simple and intuitive model is presented that enables us to characterize optimal inventory and transshipment policies for ‘n’ locations. The research is based on a case study of a bi-wheeler company in India by using its data and to strengthen its supply chain. This paper represents such an effort in that it integrates both inventory and transshipment components in the study of multi-location inventory systems. This work will enable the managers to overcome the uncertainties of demand and lead-time resulting into customer satisfaction and cost reduction.
CITED BY (12)  
1 Pratt, R. W. (2014). U.S. Patent No. 8,812,338. Washington, DC: U.S. Patent and Trademark Office.
2 Rodrigues, P. C. C. (2014). Proposta de um modelo matemático para apoio às decisões táticas da gestão da produção.
3 McMains, T. D., Burkhardt, T., & Pratt, R. W. (2014). U.S. Patent No. 8,788,315. Washington, DC: U.S. Patent and Trademark Office.
4 McMains, T. D., Burkhardt, T., & Pratt, R. W. (2014). U.S. Patent No. 8,688,497. Washington, DC: U.S. Patent and Trademark Office.
5 HARYADI, S. (2013).Perbandingan perhitungan perencanaan dan pengendalian persediaan bahan baku. bulletin ekonomi, 11(1), 1-12.
6 Fernandes, R., Gouveia, B., & Pinho, C. (2013). Integrated inventory valuation in multi-echelon production/distribution systems. International Journal of Production Research, 51(9), 2578-2592.
7 Wu, X., & Yi, J. (2013). U.S. Patent No. 8,515,835. Washington, DC: U.S. Patent and Trademark Office.
8 Çömez, N., Çakanyildirim, M., & Stecke, K. E. (2012). Optimal transshipments and reassignments under periodic or cyclic holding cost accounting. Journal of the Operational Research Society, 64(10), 1517-1539.
9 Fernandes, R., Pinho, C., & Gouveia, B. (2012). Network Modelling and Simulation for Scheduling Problems Under Restrictions in Invested Capital. Network, 1(11), 50-62.
10 Fernandes, R., Gouveia, J. B., & Pinho, C. (2011). Target setting under uncertainty. International Journal of Business Performance and Supply Chain Modelling, 3(4), 297-315.
11 S. D. Leeuw, M. Holweg and Geoff Williams, "The impact of decentralised control on firm-level inventory: Evidence from the automotive industry", International Journal of Physical Distribution & Logistics Management, 41(5), pp.435 – 456, 2011.
12 R. Fernandes, J. B. Gouveia and C. Pinho, “Target setting under uncertainty”, International Journal of Business Performance and Supply Chain Modelling, 3(4), pp. 297-315, Nov. 2011.
1 Google Scholar 
2 ScientificCommons 
3 CiteSeerX 
4 refSeek 
5 Socol@r 
6 ResearchGATE 
7 Libsearch 
8 Bielefeld Academic Search Engine (BASE) 
9 Scribd 
10 WorldCat 
11 SlideShare 
13 PdfSR 
A.J. Clark and H. Scarf. “Optimal policy for a dynamic multi-echelon inventory model”. Management Science: 475–490, 1960
A.W. Archibald, S.A. Sassen and L.C. Thomas. “An optimal policy for a two depot inventory problem with stock transfer”. Management Science 43: 173–183, 1997
Biju Kr. Thapalia, Stein W. Wallace and Michal Kaut. “Using inventory to handle risks in the supply of oil to Nepal”. Int. J. Business performance and Supply Chain Modelling, 1(1): 41-60, 2009
C. Das. “Supply and redistribution rules for two-location inventory systems: One-period analysis”. Management Science 21: 765–776, 1975
C.D.G. Waters. “Inventory Control and Management”. Wiley, Chichester, 2002
D. Gross. “Centralized inventory control in multilocation supply systems”. In: Scarf, H. Gilford. D. and Shelly. M. (Eds.). “Multistage Inventory Models and Techniques”. Stanford University Press, Stan- ford, CA (Chapter 3), 1963
F.T.S. Chan and H.K. Chan. “Effects of cascade information sharing in inventory and service level in multi echelon supply chain”. Int. J. Business performance and Supply Chain Modelling, 1(1): 1-7, 2009
H.L. Lee and C. Billington. “Managing supply chain inventory: pitfalls and opportunities”. Sloan Management Review, Spring: 65-73, 1992
J.P. Womackand and D.T. Jones. “Lean Thinking: Banish Waste and Create Wealth in Your Corporation”. Simon & Schuster, London, 1996
K. Krishnan and V. Rao. “Inventory control in N warehouses”. Journalof Industrial Engineering16: 212–215, 1965
Kishore K. Pochampally, Surendra M. Gupta and Kannan Govindan. “Metrics for performance measurement of a reverse/closed – loop supply chain”. Int. J. Business performance and Supply Chain Modelling, 1(1): 8-32, 2009
L.W. Robinson. “Optimal and approximate policies in multiperiod, multilocation inventory models with transshipments”. Operations Research 38: 278–295, 1990
M. Christopher and D. Towill. “An integrated model for the design of agile supply chains”. International Journal of Physical Distribution & Logistics Management, 31(4): 235-46, 2001
M. Christopher. “Logistics and Supply Chain Management”. Prentice-Hall, Harlow, 2005
S. Minner and E.A. Silver. “Evaluation of two simple extreme transshipment strategies”. International Journal of Production Economics: 93–94, 1–11, 2005
Simchi-Levi, D. Kaminsky. P and Simchi-Levi. E. “Designing and Managing the Supply Chain: Concepts, Strategies, and Cases”. 2nd ed., McGraw-Hill, New York, NY, 2003
Y.T. Herer and A. Rashit. “Lateral stock transshipments in a two- location inventory system with fixed and joint replenishment costs”. Naval Research Logistics 46: 525–547, 1999
Mr. Dharamvir Mangal
TITS, Bhiwani, Haryana, India - India
Assistant Professor Pankaj Chandna
- India