Inventory carrying cost has become very important in the analysis of the trade-offs and an important component to be considered when taking decisions about a logistic network. This paper proposes a methodology incorporated in a multi-echelon sourcing decision model, to be considered as a new version of the model presented in Hamad, Gualda (2008). It treats the carrying costs using the inventory Days-on-hand estimate in each echelon of the chain (plants and/or Distribution Centers). The main contributions of this methodology compared to other options found in the literature are the simplicity of its application, the consideration of all inventory costs (not only the ones related to the products being modeled) and, also, the inclusion of constraints related to warehousing capacity.
Logistic networks optimization; Logistics network design; Inventory turnover; Inventory carrying costs
