LQ optimal DSM control of perishable inventory systems with a remote supply source

In this paper the problem of efficient control of inventory systems with perishable goods is addressed from the control-theoretic perspective. In the analyzed systems, the stock at a distribution center is used to fulfill an unknown, time-varying market demand. The stock deteriorates exponentially, and is replenished with delay from a remote supply source. The objective is to specify a supply strategy such that high level of demand satisfaction is obtained despite unknown pattern of demand variations. As opposed to the previous, mainly heuristic approaches, we apply formal design methodology of sliding-mode control and discrete-time dynamical optimization. The designed controller is demonstrated to ensure full demand satisfaction irrespective of the value of delay and pattern of demand variations.