A Survey On Inventory Model With Lost-Sale

Classic inventory models commonly assume that surplus demand is backordered. However, research analysing customer behaviour in practice demonstrate that in many retail situations, unsatisfied demand is lost or replaced with an alternative item/location. Inventory systems with this lost-sales characteristic appear to be more challenging to analyse and resolve. Furthermore, to save costs, lost-sales inventory systems require different replenishment procedures than backorder systems. In this work, we present a survey on inventory models with lost sales. Furthermore, directions for future investigation are suggested