An efficient and robust design for transshipment networks

Robert W. Lien*, Seyed M.R. Iravani, Karen Smilowitz, Michal Tzur

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

28 Scopus citations


Transshipment, the sharing of inventory among parties at the same echelon level of a supply chain, can be used to reduce costs. The effectiveness of transshipment is in part determined by the configuration of the transshipment network. We introduce chain configurations in transshipment settings, where every party is linked in one connected loop. Under simplifying assumptions we show analytically that the chain configuration is superior to configurations suggested in the literature. In addition, we demonstrate the efficiency and robustness of chain configurations for more general scenarios and provide managerial insights regarding preferred configurations for different problem parameters.

Original languageEnglish (US)
Pages (from-to)699-713
Number of pages15
JournalProduction and Operations Management
Issue number5
StatePublished - Sep 2011


  • inventory pooling
  • inventory transshipment
  • network design
  • retail collaboration
  • supply chain design

ASJC Scopus subject areas

  • Management Science and Operations Research
  • Industrial and Manufacturing Engineering
  • Management of Technology and Innovation


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