Title:  An analysis of the benefits of lateral transshipment in inventory control systems.

Abstract: 

   Lateral transshipments can be a one constructive way to satisfy the customer’s demand even in the situation when the goods or items are not available to retailers. In this research paper we have developed a model to facilitate a comparison between the inventory management cost with and without lateral multi location transshipment and to measure the effect of lateral transshipment on the related parameters of inventory management. Here we have considered a mathematical model with one central warehouse and five retailers, where on the primary level the goods are to be transshipped from central warehouse to retailers and then we have analysed the whole situation in two different perspective, on one hand retailers are completely dependent on warehouse for the supply of goods while on the other hand retailers are managing the shortage situations with the support of lateral transshipment among them until actual supplies reaches to them from central warehouse, the assumptions associated with these models is that the lead time and demand will always be the changeable parameters with respect to the retailers. The objective of this research paper is to highlight the benefits of lateral transshipment that is proved to be very beneficial for minimizing the inventory cost up to the optimal level by controlling the uncertainty of demand and lead-time.

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