Novel model and algorithm of stochastic joint inventory control for virtual logistics

This exhaustive research was made on the joint inventory control problem of stochastic demand in virtual logistics. The demand for each warehouse follows Poisson distribution. An optimal joint inventory control model is proposed to minimize the whole inventory control cost comprising ordering cost, storage cost and shortage cost. The (T, S, s) model is constructed by using and adjusting the (T, S) model which is used successfully in the joint inventory control problem of single warehouse with multiple kinds of goods. Due to the NP-hard property of (T, S, s) model, this paper designs and programs a genetic algorithm with GA tool box of Matlab. Results of experiment shows the joint inventory strategy deduced by our (T, S, s) model and genetic algorithm can reduce the total storage cost of virtual logistics enterprise greatly, and it exceeds the (T, S) strategy.