In contemporary retail, the variety of products available (e.g. clothing, groceries, cosmetics, frozen goods) make it difficult to predict the demand, prevent stockouts, and find high-potential products. We suggest an agentic AI model that will be used to monitor the inventory, initiate purchase attempts to the appropriate suppliers, and scan for trending or high-margin products to incorporate. The system applies demand forecasting, supplier selection optimization, multi-agent negotiation and continuous learning. We apply a prototype to a setting in the store of a middle scale mart, test its performance on three conventional and artificial data tables, and compare the results to the base heuristics. Our findings indicate that there is a decrease in stockouts, a reduction of inventory holding costs, and an improvement in product mix turnover. We address constraints, scalability as well as improvement prospect.

This paper investigates the application of Deep Reinforcement Learning (DRL) to classical inventory management problems, with a focus on practical implementation considerations. We apply a DRL algorithm based on DirectBackprop to several fundamental inventory management scenarios including multi-period systems with lost sales (with and without lead times), perishable inventory management, dual sourcing, and joint inventory procurement and removal. The DRL approach learns policies across products using only historical information that would be available in practice, avoiding unrealistic assumptions about demand distributions or access to distribution parameters. We demonstrate that our generic DRL implementation performs competitively against or outperforms established benchmarks and heuristics across these diverse settings, while requiring minimal parameter tuning. Through examination of the learned policies, we show that the DRL approach naturally captures many known structural properties of optimal policies derived from traditional operations research methods. To further improve policy performance and interpretability, we propose a Structure-Informed Policy Network technique that explicitly incorporates analytically-derived characteristics of optimal policies into the learning process. This approach can help interpretability and add robustness to the policy in out-of-sample performance, as we demonstrate in an example with realistic demand data. Finally, we provide an illustrative application of DRL in a non-stationary setting. Our work bridges the gap between data-driven learning and analytical insights in inventory management while maintaining practical applicability.

Agricultural products are often subject to seasonal fluctuations in production and demand. Predicting and managing inventory levels in response to these variations can be challenging, leading to either excess inventory or stockouts. Additionally, the coordination among stakeholders at various level of food supply chain is not considered in the existing body of literature. To bridge these research gaps, this study focuses on inventory management of agri-food products under demand and lead time uncertainties. By implementing effective inventory replenishment policy results in maximize the overall profit throughout the supply chain. However, the complexity of the problem increases due to these uncertainties and shelf-life of the product, that makes challenging to implement traditional approaches to generate optimal set of solutions. Thus, the current study propose a novel Deep Reinforcement Learning (DRL) algorithm that combines the benefits of both value- and policy-based DRL approaches for inventory optimization under uncertainties. The proposed algorithm can incentivize collaboration among stakeholders by aligning their interests and objectives through shared optimization goal of maximizing profitability along the agri-food supply chain while considering perishability, and uncertainty simultaneously. By selecting optimal order quantities with continuous action space, the proposed algorithm effectively addresses the inventory optimization challenges. To rigorously evaluate this algorithm, the empirical data from fresh agricultural products supply chain inventory is considered. Experimental results corroborate the improved performance of the proposed inventory replenishment policy under stochastic demand patterns and lead time scenarios. The research findings hold managerial implications for policymakers to manage the inventory of agricultural products more effectively under uncertainty.

In China's competitive fresh e-commerce market, optimizing operational strategies, especially inventory management in front-end warehouses, is key to enhance customer satisfaction and to gain a competitive edge. Front-end warehouses are placed in residential areas to ensure the timely delivery of fresh goods and are usually in small size. This brings the challenge of deciding which goods to stock and in what quantities, taking into account capacity constraints. To address this issue, traditional predict-then-optimize (PTO) methods that predict sales and then decide on inventory often don't align prediction with inventory goals, as well as fail to prioritize consumer satisfaction. This paper proposes a multi-task Optimize-then-Predict-then-Optimize (OTPTO) approach that jointly optimizes product selection and inventory management, aiming to increase consumer satisfaction by maximizing the full order fulfillment rate. Our method employs a 0-1 mixed integer programming model OM1 to determine historically optimal inventory levels, and then uses a product selection model PM1 and the stocking model PM2 for prediction. The combined results are further refined through a post-processing algorithm OM2. Experimental results from JD.com's 7Fresh platform demonstrate the robustness and significant advantages of our OTPTO method. Compared to the PTO approach, our OTPTO method substantially enhances the full order fulfillment rate by 4.34% (a relative increase of 7.05%) and narrows the gap to the optimal full order fulfillment rate by 5.27%. These findings substantiate the efficacy of the OTPTO method in managing inventory at front-end warehouses of fresh e-commerce platforms and provide valuable insights for future research in this domain.

This paper shows a comprehensive analysis of three algorithms (Time Series, Random Forest (RF) and Deep Reinforcement Learning) into three inventory models (the Lost Sales, Dual-Sourcing and Multi-Echelon Inventory Model). These methodologies are applied in the supermarket context. The main purpose is to analyse efficient methods for the data-driven. Their possibility, potential and current challenges are taken into consideration in this report. By comparing the results in each model, the effectiveness of each algorithm is evaluated based on several key performance indicators, including forecast accuracy, adaptability to market changes, and overall impact on inventory costs and customer satisfaction levels. The data visualization tools and statistical metrics are the indicators for the comparisons and show some obvious trends and patterns that can guide decision-making in inventory management. These tools enable managers to not only track the performance of different algorithms in real-time but also to drill down into specific data points to understand the underlying causes of inventory fluctuations. This level of detail is crucial for pinpointing inefficiencies and areas for improvement within the supply chain.

The integration of large language models (LLMs) into supply chain management (SCM) is revolutionizing the industry by improving decision-making, predictive analytics, and operational efficiency. This white paper explores the transformative impact of LLMs on various SCM functions, including demand forecasting, inventory management, supplier relationship management, and logistics optimization. By leveraging advanced data analytics and real-time insights, LLMs enable organizations to optimize resources, reduce costs, and improve responsiveness to market changes. Key findings highlight the benefits of integrating LLMs with emerging technologies such as IoT, blockchain, and robotics, which together create smarter and more autonomous supply chains. Ethical considerations, including bias mitigation and data protection, are taken into account to ensure fair and transparent AI practices. In addition, the paper discusses the need to educate the workforce on how to manage new AI-driven processes and the long-term strategic benefits of adopting LLMs. Strategic recommendations for SCM professionals include investing in high-quality data management, promoting cross-functional collaboration, and aligning LLM initiatives with overall business goals. The findings highlight the potential of LLMs to drive innovation, sustainability, and competitive advantage in the ever-changing supply chain management landscape.

-- In this paper, we propose a novel reinforcement learning algorithm for inventory management of newly launched products with no historical demand information. The algorithm follows the classic Dyna-Q structure, balancing the model-free and model-based approaches, while accelerating the training process of Dyna-Q and mitigating the model discrepancy generated by the model-based feedback. Based on the idea of transfer learning, warm-start information from the demand data of existing similar products can be incorporated into the algorithm to further stabilize the early-stage training and reduce the variance of the estimated optimal policy. Our approach is validated through a case study of bakery inventory management with real data. The adjusted Dyna-Q shows up to a 23.7% reduction in average daily cost compared with Q-learning, and up to a 77.5% reduction in training time within the same horizon compared with classic Dyna-Q . By using transfer learning, it can be found that the adjusted Dyna-Q has the lowest total cost, lowest variance in total cost, and relatively low shortage percentages among all the benchmarking algorithms under a 30-day testing. I. INTRODUCTION Inventory management is crucial for supply chain operations, overseeing and controlling the order, storage, and usage of goods in business [1]. In inventory management, the cold-start setting refers to predicting demand and formulating appropriate inventory strategies when new products are introduced or new market demands arise due to the lack of historical data [2].

Deploying deep reinforcement learning (DRL) in real-world inventory management presents challenges, including dynamic environments and uncertain problem parameters, e.g. demand and lead time distributions. These challenges highlight a research gap, suggesting a need for a unifying framework to model and solve sequential decision-making under parameter uncertainty. We address this by exploring an underexplored area of DRL for inventory management: training generally capable agents (GCAs) under zero-shot generalization (ZSG). Here, GCAs are advanced DRL policies designed to handle a broad range of sampled problem instances with diverse inventory challenges. ZSG refers to the ability to successfully apply learned policies to unseen instances with unknown parameters without retraining. We propose a unifying Super-Markov Decision Process formulation and the Train, then Estimate and Decide (TED) framework to train and deploy a GCA tailored to inventory management applications. The TED framework consists of three phases: training a GCA on varied problem instances, continuously estimating problem parameters during deployment, and making decisions based on these estimates. Applied to periodic review inventory problems with lost sales, cyclic demand patterns, and stochastic lead times, our trained agent, the Generally Capable Lost Sales Network (GC-LSN) consistently outperforms well-known traditional policies when problem parameters are known. Moreover, under conditions where demand and/or lead time distributions are initially unknown and must be estimated, we benchmark against online learning methods that provide worst-case performance guarantees. Our GC-LSN policy, paired with the Kaplan-Meier estimator, is demonstrated to complement these methods by providing superior empirical performance.

Inventory control in modern supply chains has attracted significant attention due to the increasing number of disruptive shocks and the challenges posed by complex dynamics, uncertainties, and limited collaboration. Traditional methods, which often rely on static parameters, struggle to adapt to changing environments. This paper proposes a Multi-Agent Reinforcement Learning (MARL) framework with Graph Neural Networks (GNNs) for state representation to address these limitations. Our approach redefines the action space by parameterizing heuristic inventory control policies, making it adaptive as the parameters dynamically adjust based on system conditions. By leveraging the inherent graph structure of supply chains, our framework enables agents to learn the system's topology, and we employ a centralized learning, decentralized execution scheme that allows agents to learn collaboratively while overcoming information-sharing constraints. Additionally, we incorporate global mean pooling and regularization techniques to enhance performance. We test the capabilities of our proposed approach on four different supply chain configurations and conduct a sensitivity analysis. This work paves the way for utilizing MARL-GNN frameworks to improve inventory management in complex, decentralized supply chain environments.

This paper addresses the capacitated periodic review inventory control problem, focusing on a retailer managing multiple products with limited shared resources, such as storage or inbound labor at a facility. Specifically, this paper is motivated by the questions of (1) what does it mean to backtest a capacity control mechanism, (2) can we devise and backtest a capacity control mechanism that is compatible with recent advances in deep reinforcement learning for inventory management? First, because we only have a single historic sample path of Amazon's capacity limits, we propose a method that samples from a distribution of possible constraint paths covering a space of real-world scenarios. This novel approach allows for more robust and realistic testing of inventory management strategies. Second, we extend the exo-IDP (Exogenous Decision Process) formulation of Madeka et al. 2022 to capacitated periodic review inventory control problems and show that certain capacitated control problems are no harder than supervised learning. Third, we introduce a `neural coordinator', designed to produce forecasts of capacity prices, guiding the system to adhere to target constraints in place of a traditional model predictive controller. Finally, we apply a modified DirectBackprop algorithm for learning a deep RL buying policy and a training the neural coordinator. Our methodology is evaluated through large-scale backtests, demonstrating RL buying policies with a neural coordinator outperforms classic baselines both in terms of cumulative discounted reward and capacity adherence (we see improvements of up to 50% in some cases).