Optimization of buffer allocations in flow lines with limited supply

The supply of flow lines is often assumed to be unlimited or to follow certain distributions. However, this assumption may not always be realistic, as flow lines are usually an integral part of a supply chain where raw material is replenished based on some rule. We therefore include the limited supply into the optimization of buffer capacities in terms of an order policy. To integrate this type of supply into an optimization model, we exploit the flexibility of a sample-based optimization approach. We develop an efficient rule-based local search algorithm that employs new individual lower bounds in order to determine the optimal buffer capacities of a flow line. In addition to the efficiency of the proposed algorithm, the numerical study demonstrates that the order policy has a significant impact on the optimal buffer allocation.