Recent Advances in Centralized and Decentralized Multi-Location Transshipment Problems

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TITLE:  Recent Advances in Centralized and Decentralized Multi-Location Transshipment Problems

SPEAKER:  Dr. Michal Tzur


The multi-location replenishment and transshipment problem is concerned with several retailers facing random demand for the same item at distinct markets, that may use transshipments to eliminate excess inventory/shortages after demand realization. For a centralized system we summarize recent advances related to operational and design aspects of the problem. Our main focus in this talk is on the decentralized system, in which the retailers operate to maximize their own profit. This causes incentive problems that prevent coordination, even with two retailers who may pay each other for transshipped units. We propose a new mechanism based on a transshipment fund which is the first to coordinate the system, in a fully non-cooperative setting, for all instances of two retailers as well as all instances of any number of retailers. The computation and information requirements of this mechanism are realistic and relatively modest. We also present necessary and sufficient conditions for coordination and prove they are always satisfied with our mechanism.


Michal Tzur is an Associate Professor in the Industrial Engineering department at the Faculty of Engineering at Tel Aviv University in Israel, where she served as the head of the undergraduate program and as the department chair. Michal joined Tel Aviv University after spending three years at the Operations and Information Management department at Wharton School at the University of Pennsylvania. She received her B.A. from Tel Aviv University and her M. Phil and Ph.D. from Columbia University. During the years 2002-2004 she visited the IEMS department at Northwestern University. Her areas of expertise are supply chain management, inventory routing and transportation.


  • Workflow Status: Published
  • Created By: Anita Race
  • Created: 09/15/2010
  • Modified By: Fletcher Moore
  • Modified: 10/07/2016


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