Graduation Semester and Year

2021

Language

English

Document Type

Dissertation

Degree Name

Doctor of Philosophy in Industrial Engineering

Department

Industrial and Manufacturing Systems Engineering

First Advisor

Brian L Huff

Abstract

This research aspires to develop a systematic approach to minimize the demand and supply gap of products and product expiration in a feasible way. Inventory replenishment policy, uncertain customer demand, and forecast inaccuracy are some of the reasons that create imbalanced stocks in the outlets. Lateral transshipment or redistribution, donation, and promotion have been discussed in the existing literature separately as ways to balance and utilize inventory. Redistribution needs to account for extra transportation costs due to stock transfer. Existing literature on redistribution fails to address products’ physical attributes, valuation of products as a function of time, and constraint on receiving products’ life. An integrated process for identifying the most suitable products for redistribution and donation is also absent in the literature. While considering redistribution, it is helpful for the retailer to know which products can provide the best benefit from redistribution. Identification of products based on their redistribution benefit cannot be found in current works. This work presents a process for categorizing products according to their predicted profitability as a result of redistribution. A decision support tool has also been introduced to identify the products which can be donated and redistributed. A redistribution model of a stochastic two-echelon, multi-period, multi-product, multi-outlet retail network has been developed based on a bidding strategy to address the imbalance of stock levels. This model incorporates the use of the product’s weight, volume, allowable life constraints and dynamically considers product value as a function of time. Donation option has been included with redistribution in our mode to balance inventory and reduce waste. A hybrid agent-based and discrete-event simulation model was constructed to represent this complex system. Actual data from an existing retail chain has been used to represent the demand of 155 SKUs over a ten-store retail chain. A “periodic review-order up to level” inventory control system was utilized. Results indicate that redistribution has impacted the total retail system’s performance significantly for Net Cash Inflow, customer satisfaction (Fill Rate), and cash inflow over cost ratio. On the other hand, slow-moving items get the most benefit from disposal through donation.

Keywords

Redistribution, Donation, Decision support tool, Hybrid simulation, Agent-based simulation

Disciplines

Engineering | Operations Research, Systems Engineering and Industrial Engineering

Comments

Degree granted by The University of Texas at Arlington

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