Application of queuing theory in production-inventory optimization

Subject Areas : Mathematical Optimization

Reza Rashid ¹ , Seyed Farzad Hoseini ² , M. R. Gholamian ³ , Mohammad Feizabadi ⁴

1 - Department of Industrial Engineering, Iran University of Science and Technology, Narmak, 16844, Tehran, Iran
2 - Department of Industrial Engineering, Iran University of Science and Technology, Narmak, 16844, Tehran, Iran
3 - Department of Industrial Engineering, Iran University of Science and Technology, Narmak, 16844, Tehran, Iran
4 - Department of Industrial Engineering, Sharif University, Azady, Tehran, Iran

Received: 2020-10-02 Accepted : 2020-10-02 Published : 2015-12-01

Keywords: Production inventory . Queuing theory . Multi, item inventory . Heuristic algorithm,

Abstract :

This paper presents a mathematical model for an inventory control system in which customers’ demands and suppliers’ service time are considered as stochastic parameters. The proposed problem is solved through queuing theory for a single item. In this case, transitional probabilities are calculated in steady state. Afterward, the model is extended to the case of multi-item inventory systems. Then, to deal with the complexity of this problem, a new heuristic algorithm is developed. Finally, the presented bi-level inventory-queuing model is implemented as a case study in Electroestil Company.