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| Main Authors: | , , |
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| Format: | Preprint |
| Published: |
2025
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| Subjects: | |
| Online Access: | https://arxiv.org/abs/2501.08109 |
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| _version_ | 1866910993915838464 |
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| author | Qu, Xinye Liu, Longxiao Huang, Wenjie |
| author_facet | Qu, Xinye Liu, Longxiao Huang, Wenjie |
| contents | 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. |
| format | Preprint |
| id |
arxiv_https___arxiv_org_abs_2501_08109 |
| institution | arXiv |
| publishDate | 2025 |
| record_format | arxiv |
| spellingShingle | Data-driven inventory management for new products: An adjusted Dyna-$Q$ approach with transfer learning Qu, Xinye Liu, Longxiao Huang, Wenjie Machine Learning Artificial Intelligence Computational Engineering, Finance, and Science 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. |
| title | Data-driven inventory management for new products: An adjusted Dyna-$Q$ approach with transfer learning |
| topic | Machine Learning Artificial Intelligence Computational Engineering, Finance, and Science |
| url | https://arxiv.org/abs/2501.08109 |