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The classical Economic Order Quantity (EOQ) captures only the trade-off between inventory carrying cost and setup; transportation cost is either neglected or included in set up cost. Over 50% of the total annual logistics cost of a product can be attributed to transportation, thus any consideration...
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| Main Author: | |
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| Format: | Theses |
| Language: | Indonesia |
| Online Access: | https://digilib.itb.ac.id/gdl/view/18381 |
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| Institution: | Institut Teknologi Bandung |
| Language: | Indonesia |
| Summary: | The classical Economic Order Quantity (EOQ) captures only the trade-off between inventory carrying cost and setup; transportation cost is either neglected or included in set up cost. Over 50% of the total annual logistics cost of a product can be attributed to transportation, thus any consideration of purchase quantities should consider transportation costs. In multi-level inventory system, distributor and retailers need to synchronize their inventory. Integer Ratio Policies is one of the ways to coordinate the relationship between retailers and distributor. The aim is to minimize the system inventory cost as well as improving the scheduling, receiving, inspection and information processing tasks. <br />
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This research deals with multi-level multi-item inventory management considering transportation cost and capacity constraint. Three types of transportation are used; namely own vehicles, hired vehicles and Less than Truckload (LTL). The goal of this research is to determine the optimum order interval which results in minimum total cost. Transportation cost is also considered for deciding optimum solution. Solution algorithms to obtain the optimum values are proposed. Numerical examples and sensitivity analysis are performed to verify the effects of parameters change and the behavior of these models. |
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