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Approximate Approach to Calculating the Order Fill Rate under Purchase Dependence
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 Title & Authors
Approximate Approach to Calculating the Order Fill Rate under Purchase Dependence
Park, Changkyu; Seo, Junyong;
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This paper proposes a new approximate approach to calculate the order fill rate and the probability of filling an entire customer order immediately from the shelf in a business environment under purchase dependence characterized by customer purchase patterns observed in such areas as marketing, manufacturing systems, and distribution systems. The new approximate approach divides customer orders into item orders and calculates fill rates of all order types to approximate the order fill rate. We develop a greed iterative search algorithm (GISA) based on the Gauss-Seidel method to avoid dimensionality and prevent the solution divergence for larger instances. Through the computational analysis that compares the GISA with the simulation, we demonstrate that the GISA is a dependable algorithm for deriving the stationary joint distribution of on-hand inventories in the type-K pure system. We also present some managerial insights.
Order Fill Rate;Purchase Dependence;Iterative Approach;Quasi-Birth-and-Death Process;
 Cited by
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