Experts in operations research and developers of software application systems have been treading separate paths for many years. It is urgently necessary to reset this course so that the demanding requirements of variousCIM concepts can be realized. This is specially relevant for computer-based stock management. Both authors, with a number of years of practical experience behind them, have written this book with this objective in mind. The book shows how modern inventory control can be rationally structured with the help of OR. Two aspects are given importance:1) the necessary mathematical derivations are completely explained in detail so that the reader will be able to optimally handle a given situation with the help of the methods learned in this book, and 2) aside from the models, strong emphasis is given on numerical methods. Suitable algorithms are thoroughly explained for the more important cases.

1: Deterministic Inventory Models

1 Introduction
2 Economic Order Quantity (EOQ)
3 Costs and Sensitivity
4 RM-Systems (ABC Analysis)
5 Product-Mix Decision
6 Estimating the Rate of Demand
7 Profit Maximization
8 Inventory Evaluation
9 Quantity Discount
10 Collective or Single Order ?
11 Optimal Stocking in Serial Production
12 Stock-outs Allowed
13 Discrete Lot Sizes
14 Consideration of Shelf Space in Inventory
15 Budget Restriction
16 Known but Varying Demand
17 Fixed Delivery Period ?
18 Safety Stock with Stochastic Delivery Time (including Just-in-Time Production)
2: The Wilson Model with Poisson Demand
19 Poisson Process
20 General Remarks on Chance
21 Interest, Continuous Interest, Present Value
22 Inventory with Poisson Demand and Immediate Delivery
23 Poisson Demand, No Discounting
24 Recurrent Process
25 Proof of Optimality
3: Stochastic Single Period Models
26 The Newsboy Problem
27 Evaluation of $$ {\text{P}}\left( {\text{x}} \right){\text{ = }}\frac{{\text{g}}}{{{\text{h + g}}}} $$
28 Temporal Structure of the Newsboy Problem
29 Exact Formulation
30 Overbooking
4: Stochastic Models with Continuous Review
31 Method of State Probabilities
32 Poisson Demand, Exponential Delivery Time
33 Poisson Demand, Fixed Delivery Time ?
34 Poisson Demand, Stochastic Delivery Time, Single Order
35 Poisson Demand, Stochastic Delivery Time, Multiple Orders
5: Stochastic Models with Periodic Review
36 The Arrow-Harris-Marschak Model
37 The AHM-Model in the Stationary Case
38 Standardization
39 Exponentially Distributed Demand
40 Optimality of the (s,S)-Policy
41 Elimination of Proportional OrderingCosts with Finite Planning Horizon
42 Bounds for (sn,Sn)
43 Optimality of the (s,S)-Policy in the Stationary Model
44 A Method for Computing s and S
45 AHM-Model with Delivery Time
46 Autocorrelated Demand
47 Inventory with Forecasting
6: Numerical Methods
48 Value Iteration
49 Policy Iteration
50 Bisection Method and Dynamic Programming
51 Computation of Optimal (s,S)-Policies according to Federgruen and Zipkin
Closing Remarks
Literature.