This presentation discusses the integrated design and operation of an inventory control and distribution system for remnant inventory.  Such inventory is encountered in the supply chains of various one-dimensional products such as rolls of steel, aluminum, paper, fabric, etc. where the product is produced in "standard" sizes but demands occur in "nonstandard" sizes.  This ongoing research (a) combines elements of several classical O.R. problem areas including the cutting stock problem, inventory management, facility location, and distribution, and (b) proposes the use of several different O.R. techniques such as Benders’ decomposition, stochastic programming, and remnant inventory control. Based on earlier work by Adelman and Nemhauser, a combined location/distribution network model is described for the problem where locations for both inventory distribution points and demand are geographically dispersed.  We also assume that scrap can be recycled, and discuss extensions such as stochastic demand and raw material sizing.

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