Analysis of inventory policies for perishable items with fixed leadtimes and lifetimes

This paper deals with a continuous review inventory system with perishable items and Poisson demand. Lifetimes and leadtimes are assumed to be fixed. First, a quite general base-stock model is developed where a number of combinations between backorder- and lost sales policies are evaluated and optimized. The solution technique for all these combinations is exact. Secondly, we consider the case with non-negligible ordering costs and assume that the inventory policy employed is the commonly used (R, Q) policy. We develop a new heuristic approach for evaluating and analyzing the proposed (R, Q) model and compare our results with those obtained by related papers. This heuristic approach uses the base-stock model developed as a building block. The results reveal that our approach works reasonably well in all cases considered.