An airline fueling system maintains fuel levels at full tank capacities by ordering fuel shortages on a daily basis. Although this policy avoids fuel stock out, but it results in excessive inventory. This research aims at determining the days of inventory on hand (DOH) that reduces the cost of total inventory cost while avoiding stock out using system dynamics. Initially, the fuel demand rate is modeled and found best-fitted by exponential distribution. By simulation followed by optimization, the DOH is estimated for several price and demand rate level combinations. It is found that the proposed model for fuel ordering results in remarkable yearly savings in total inventory cost without having stock out. Moreover, using risk assessment, the optimal DOH is found insensitive to random variations in lead time, information delay, and holding cost factor.


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    Title :

    A system dynamics approach to reduce total inventory cost in an airline fueling system


    Contributors:
    Al-Refaie, A. (author) / Al-Tahat, M. (author) / Jalham, I. (author)


    Publication date :

    2010


    Size :

    7 Seiten, 3 Bilder, 4 Tabellen, 12 Quellen


    Remarks:

    (nicht paginiert)




    Type of media :

    Conference paper


    Type of material :

    Storage medium


    Language :

    English




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