A complete model for cost-optimized lateral transshipment in a multi-supplier environment

![CDATA[Logistics practitioners must continually improve inventory management processes as they daily respond to the intense market competition that demands cost efficiency enhancements. This study investigates managerial decision-making on cost optimized lateral transshipment in a multi-supplier and multi-customer environment where partial orders can be placed with multiple suppliers. Lateral transshipments are when goods are sourced from the actors in the same echelon of the supply chain network and they are more expensive than supplies from regular supplies but instantaneous. We consider the presence of outstanding supplier orders at the beginning of the scheduling period reflecting more realistic situation in a periodic review inventory policy setting. Some suppliers are expensive but provide guaranteed lead time for supply, while others are less costly but their service is unlikely to be reliable. This study takes account of the trade-off between reliability and cost into account, a cost function is derived to support managerial decision-making on inventory management. Unlike the existing traditional approaches that rely on complicated computation of probability, we propose a fuzzy based approach that offers a more practical approach for industry. This study contributes to research on cost optimization in complex inventory system and the findings have implications for industry.]]