Inventory Management in Omnichannel Supply Chains

Abstract

We study the multi-period inventory replenishment problem for an omnichannel retailer that aims to optimally position inventory across its warehouses and stores to meet its uncertain omnichannel demand that includes walk-ins at stores as well as online demand that can be fulfilled from any location. We present a robust optimization-based heuristic and discuss different variations to solve this problem. Using real-data from a retailer, we perform network-based simulations and compare the impact of this and other typical heuristics on various KPIs of interest.