Using Break Quantities for Tactical Optimisation in Multistage Distribution Systems

Arbeitspapier

In this chapter we discuss a tactical optimisation problem that arises in a multistage distribution system where customer orders can be delivered from any stockpoint. A simple rule to allocate orders to locations is a break quantity rule, which routes large orders to higher-stage stockpoints and small orders to end-stockpoints. A so-called break quantity determines whether an order is small or large. We present a qualitative discussion on the implications of this rule for the marketing process, and a qualitative and quantitative analysis on the implications for the transportation and inventory costs. Furthermore, wepresent a case study for a company that implemented a break quantity rule. Finally, in the last section the main results are summarised.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Tinbergen Institute Discussion Paper ; No. 97-094/4

Classification and Topics

• Classification: Wirtschaft
• Subject: Distribution systems ; inventory ; transportation ; marketing ; break quantity rule

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Kleijn, Marcel J. ; Dekker, Rommert
• Event: Veröffentlichung
• (who): Tinbergen Institute
• (where): Amsterdam and Rotterdam
• (when): 1997

Further information

• Handle: http://hdl.handle.net/10419/85593
• Last update: 10.03.2025, 11:45 AM CET