An Ordering Policy for Repairable Stock Items

Abstract

When a stock item fails, it is assumed to be repairable with a known positive probability less than one. In this case stock must be replenished on occasion with new supplies. An ordering policy of the familiar reorder point-order quantity type is considered, and expressions developed for expected shortages, inventory, and number of orders per unit of time. Because shortages within a replenishment cycle can decrease because of returns from repair, the derivation of expected shortages is of particular interest.