(T, S) policy for coordinated inventory replenishment systems under compound Poisson demands

This paper considers the coordinated 'periodic-review, order-up-to-level' p olicy, called. (T, S) policy, for multi-item inventory systems. The mathema tical model of (T, S) policy for single-item inventory systems is extended to the more realistic multi-item inventory systems with compound Poisson de mands, positive replenishment lead times, as well as service level constrai nts. Numerical comparisons with 'can-order' policy (S, c, s) with different treatments show that the (T, S) policy outperforms the extensively studied . (S, c, s) policy. Especially when the lead time is not too short, conside rable cost reductions can be achieved through an inventory system employing the (T, S) policy.