LOWER BOUNDS FOR MULTIECHELON STOCHASTIC INVENTORY SYSTEMS

We establish lower bounds on the minimum costs of managing certain pro duction-distribution networks with setup costs at all stages and stoch astic demands. These networks include serial, assembly, and one-wareho use multi-retailer systems. We obtain the bounds through novel cost-al location schemes. We evaluate the bounds' performance for one-warehous e multi-retailer systems by comparing them with simple, heuristic poli cies. The bounds are quite tight for systems with a small number of re tailers. We also present simplified proofs of known optimality results for serial and assembly systems.