Journal of the Operational Research Society

, Volume 52, Issue 7, pp 830–838 | Cite as

Multi-echelon multi-company inventory planning with limited information exchange

Technical Note


Supply chain planning concepts from multi-echelon inventory theory are generally based on some form of centralised planning of supply chains. Those multi-echelon models that do consider decentralised planning, assume complete information and/or a specific single objective function. This paper investigates how multi-echelon inventory theory can accommodate a setting with decentralised decision makers (a supplier and a number of retail groups) without complete information. We present a coordination procedure that does not require the retail groups to exchange demand information, but does allow using opportunities for demand pooling between them. We illustrate our ideas by way of a quantitative analysis of a two-echelon divergent supply chain, with both cooperative and non cooperative retail groups. We conclude that coordination across a supply chain with decentralised control and limited centralised information is feasible by using available algorithms with satisfactory service level and cost performance.


supply chain management inventory control distribution allocation 


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Copyright information

© Palgrave Publishers Ltd 2001

Authors and Affiliations

  1. 1.Technische Universiteit EindhovenEindhovenThe Netherlands

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