Doctor of Philosophy (PhD)


Engineering Science (Interdepartmental Program)

Document Type



The research aims are to enable the decision maker of an integrated vendor-buyer system under Consignment Stock (CS) policy to make the optimal/sub-optimal production/replenishment decisions when some general and realistic critical factors are considered. In the system, the vendor produces one product at a finite rate and ships the outputs by a number of equal-sized lots within a production cycle. Under a long-term CS agreement, the vendor maintains a certain inventory level at the buyer’s warehouse, and the buyer compensates the vendor only for the consumed products. The holding cost consists of a storage component and a financial component. Moreover, both of the cases that the unit holding costs may be higher at the buyer or at the vendor are considered. Based upon such a system, four sets of inventory models are developed each of which considers one more factor than the former. The first set of models allows a controllable lead-time with an additional investment and jointly determines the shipping size, the number of shipments, and the lead time, that minimize the yearly joint total expected cost (JTEC) of the system. The second set of models considers a buyer’s capacity limitation which causes some shipments to be delayed so that the arrival of these shipments does not cause the buyer’s inventory to go beyond its limitation. As a result, the number of delayed shipments is added as the fourth decision variable. A variable demand rate is allowed in the third set of models. Uncertainty caused by the varying demand are controlled by a safety factor, which becomes the fifth decision variable. Finally, the risk of obsolescence of the product is considered in the fourth model. The first model is solved analytically, whereas the rest are not, mainly because of the complexity of the problem and the number of variables being considered. Three doubly-hybrid meta-heuristic algorithms that combine two different hybrid meta-heuristic algorithms are developed to provide a solution procedure for the rest of models. Numerical experiments illustrate the solution procedures and reveal the effects of the buyer’s capacity limitation, the effects of the variable demand rate, and the effects of the risk of obsolescence, on the system. Furthermore, sensitivity analysis shows that some of the system parameters (such as the backorder penalty, the extra space penalty, the ratio of the unit holding cost of the vendor over that of the buyer) are very influential to the joint system total cost and the optimal solutions of the decision variables.



Document Availability at the Time of Submission

Release the entire work immediately for access worldwide.

Committee Chair

Sarker, Bhaba R.