Developing of Variable Review Periods with Order Crossover

Abstract: In this paper, a variable review period model considering order crossover is compared to periodic order review model. The simulation is applied with six scenarios and sensitivity analysis is also done. The result shows that a variable review period performs smaller inventory cost for small variation of lead-time. The result also shows variable review period model is sensitive with the changes in the lead-time distribution. On the other hand, periodic review model is sensitive with the changes in the variation of demand distribution and service level. The inventory cost of periodic review model will be smaller than the review period when a ratio of holding cost and stock out cost is 1:6.