| Abstract: | This paper is concerned with the determination of reorder points and safety-stock levels for situations where both the demand and lead-time distributions are discrete and independent. Formulas are developed for computing exact probabilities for the lead-time demand distribution on the basis of empirical distributions. Practitioners can use the model to obtain exact probabilities for situations where the computational burden is justified, while academicians can use the model to evaluate heuristic approaches to the reorder-point problem. |
