Integrated Inventory Transshipment and Missing-Data Treatment Using Improved Imputation-Level Adjustment for Efficient Cross-Filling

Abstract

This research investigates an integrated problem of transshipment for cross-filling and imputation for missing demand data. Transshipment for cross-filling has proved effective in mitigating shortages with relatively low inventory, thus reducing resource consumption in inventory management. Although accurate demand data are critical for cross-filling decision making, some demand data are inevitably incomplete. These missing data should be treated for effective transshipment operations. Despite the importance, these missing data issues have not been adequately studied for transshipment problems. This paper addresses how transshipment can be conducted under missing demand conditions. A novel integrated problem is established to combine demand-data imputation processes and transshipment decisions. Imputation strategies and new algorithms suitable for transshipment are developed to handle missing demand data. Diverse demand and transshipment cases are analyzed for cost-effectiveness. The analysis uncovers that conventional straightforward imputation methods result in inferior transshipment decisions. The study also reveals that imputed values should be adjusted to appropriate levels for transshipment to be effective. The strong interplay between imputation processes and shortage prevention is also discovered for transshipment with missing demand. This study demonstrates how inventory transshipment can be carried out successfully with appropriate treatment of missing demand data in practice.