Inventory Management with product returns: the value of information
Year: 2003
Type: preprint
Abstract: This paper evaluates the impact of misinformation for inventory systems with product returns. If one could exactly know how much is going to be returned and when, one would certainly benefit from incorporating this perfect information a priori in the management of production, inventory, and distribution. In practice, one has to attempt to forecast the timing and the amount of product returns, by hypothesizing about the return flow properties. To do so, historic data on demand and returns can be used. The available literature on information and inventory management with product returns commonly 1) assumes known return probabilities; or 2) considers specific cases where the most-informed method leads to the best forecast. This paper identifies situations in which the most informed method does not necessarily lead to the best performance, investigating the impact on inventory related costs.
Source: SSRN Electronic Journal
Authors: A. van der Laan, MP De Brito
Language: English
Field: Decision Sciences
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W3124961483