Mathematical Model for a Two-Tier, Two-Storage-Point Inventory Management System with Lateral Stock Transfer

Inventory management, Levels and storage points, Lateral transfer or stock cross- docking.

Authors

  • Dambo Punga Instutit Supérieur des Commerces d' Ilebo B.P 168 Ilebo (Kasaï)
  • Mabela Makengo Université de Kinshasa, Faculté des Sciences et Technologies, B.P. 190 Kinshasa XI
July 23, 2025

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In our study of the mathematical model for a two-tier, two-storage-point inventory management system with lateral stock transfer, we analyze the parameters required to minimize total inventory management costs and assess the impact of lateral stock transfers between the two storage points. We asked whether stock transfers between storage points can contribute to minimizing total costs and avoiding stockouts.

Lateral stock transfers between storage points could contribute to minimizing total inventory management costs and avoiding stockouts or shortages at the storage points. We first analyzed the inventory management system in the case where there is no lateral stock transfer, and then we studied the case where there is lateral stock transfer, with or without constraints, using the (R,S) inventory management model. The originality of this article lies in the fact that a numerical application was developed using Matlab software, allowing us to analyze the various parameters. It follows that the total management cost is higher in the case of management without lateral transfer than in the case with lateral stock transfer. The contribution of cross-docking between retailers is important to avoid the risk of stockouts and contributes to improving customer satisfaction rates.