In this paper a heuristic procedure is developed to determine the optimum inventory policies for an inventory system consisting of a single product and raw materials used in the manufacture of the product. The raw materials are optimally classified into groups so that the total inventory cost per unit time is minimized. The cost expression used as the objective function takes the inventory relationship between the product and its raw materials into consideration.
All Science Journal Classification (ASJC) codes
- Strategy and Management
- Management Science and Operations Research
- Industrial and Manufacturing Engineering