Inventory rationing with critical level policies: a structured literature review

Differentiating service for various customer classes is a critical challenge in modern supply chains, particularly in sectors like e-commerce, healthcare, and industries reliant on critical spare parts. Inventory rationing with critical level policies is a key mechanism to address this challenge. This study presents a comprehensive, structured literature review of 128 studies on this topic. We classify existing research based on problem characteristics, such as the distinction between capacitated and non-capacitated systems, and policy structures, which we categorise as static, dynamic, or state-dependent. Our findings show that lead time uncertainty is an important factor determining whether the optimal policy is dynamic or state-dependent, and that simpler static policies often perform remarkably close to complex optimal ones, offering a highly practical solution for managers. Based on this synthesis, we identify research gaps, such as the study of rationing policies for capacitated systems with service level constraints and real-world applications like healthcare, where the differentiation between critical and non-critical supplies, taking into account product substitutions, is vital.