An Aggregated Newsvendor Model for Multi-Item Perishable Inventories with Uncertain Demand

In industrial and commercial settings, inventory systems often involve managing multiple products with diverse demand patterns, making the direct application of the single-item newsvendor model inefficient. To address this complexity, this study proposes an adaptation of the newsvendor model through...

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Main Authors: Dwi Kurniawan, Aghnia Nazhiifah Ulhaq, Aditya Fadhilah Althofian, Rubby Nur Rachman
Format: Article
Language:English
Published: Iran University of Science & Technology 2024-12-01
Series:International Journal of Industrial Engineering and Production Research
Subjects:
Online Access:http://ijiepr.iust.ac.ir/article-1-2097-en.pdf
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author Dwi Kurniawan
Aghnia Nazhiifah Ulhaq
Aditya Fadhilah Althofian
Rubby Nur Rachman
author_facet Dwi Kurniawan
Aghnia Nazhiifah Ulhaq
Aditya Fadhilah Althofian
Rubby Nur Rachman
author_sort Dwi Kurniawan
collection DOAJ
description In industrial and commercial settings, inventory systems often involve managing multiple products with diverse demand patterns, making the direct application of the single-item newsvendor model inefficient. To address this complexity, this study proposes an adaptation of the newsvendor model through demand aggregation, where related items are grouped into a product family. By aggregating demand and financial parameters, the traditional newsvendor approach can be extended to multi-item systems, simplifying the inventory management process. This method was tested in two different case studies—a coffee roaster company and a meatball producer—demonstrating its validity and applicability. The aggregated newsvendor model was found to enhance inventory accuracy and efficiency, reducing random error and improving operational performance. This approach offers a valuable extension of the newsvendor model, with potential for broader application across various industries.
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publisher Iran University of Science & Technology
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series International Journal of Industrial Engineering and Production Research
spelling doaj-art-63d7a6c29a2a4b93bdbbf88bb9091a582025-08-20T02:23:08ZengIran University of Science & TechnologyInternational Journal of Industrial Engineering and Production Research2008-48892345-363X2024-12-013542941An Aggregated Newsvendor Model for Multi-Item Perishable Inventories with Uncertain DemandDwi Kurniawan0Aghnia Nazhiifah Ulhaq1Aditya Fadhilah Althofian2Rubby Nur Rachman3 Institut Teknologi Nasional Bandung- Indonesia Institut Teknologi Nasional, Bandung 40124, Indonesia Institut Teknologi Nasional, Bandung 40124, Indonesia Institut Teknologi Nasional, Bandung 40124, Indonesia In industrial and commercial settings, inventory systems often involve managing multiple products with diverse demand patterns, making the direct application of the single-item newsvendor model inefficient. To address this complexity, this study proposes an adaptation of the newsvendor model through demand aggregation, where related items are grouped into a product family. By aggregating demand and financial parameters, the traditional newsvendor approach can be extended to multi-item systems, simplifying the inventory management process. This method was tested in two different case studies—a coffee roaster company and a meatball producer—demonstrating its validity and applicability. The aggregated newsvendor model was found to enhance inventory accuracy and efficiency, reducing random error and improving operational performance. This approach offers a valuable extension of the newsvendor model, with potential for broader application across various industries.http://ijiepr.iust.ac.ir/article-1-2097-en.pdfprobabilistic inventory systemuncertain demandnewsvendor modelexpected profit
spellingShingle Dwi Kurniawan
Aghnia Nazhiifah Ulhaq
Aditya Fadhilah Althofian
Rubby Nur Rachman
An Aggregated Newsvendor Model for Multi-Item Perishable Inventories with Uncertain Demand
International Journal of Industrial Engineering and Production Research
probabilistic inventory system
uncertain demand
newsvendor model
expected profit
title An Aggregated Newsvendor Model for Multi-Item Perishable Inventories with Uncertain Demand
title_full An Aggregated Newsvendor Model for Multi-Item Perishable Inventories with Uncertain Demand
title_fullStr An Aggregated Newsvendor Model for Multi-Item Perishable Inventories with Uncertain Demand
title_full_unstemmed An Aggregated Newsvendor Model for Multi-Item Perishable Inventories with Uncertain Demand
title_short An Aggregated Newsvendor Model for Multi-Item Perishable Inventories with Uncertain Demand
title_sort aggregated newsvendor model for multi item perishable inventories with uncertain demand
topic probabilistic inventory system
uncertain demand
newsvendor model
expected profit
url http://ijiepr.iust.ac.ir/article-1-2097-en.pdf
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