Abstract
This paper first identifies the major three obstacles to an ideal logistics system, which are long lead time, demand uncertainty and number of stages in decision making. In order to assess the impact of the three obstacles, system inventory levels which demanded for a given service level are formulated for three different models called independence, information sharing and integration model respectively. Through the numerical analysis, the following suggestions are derived. The information sharing should be fully exploited in particular under longer lead time condition. At the same time, continuous reduction of bottle-neck lead time in terms of replenishment cycle is most essential object of efficient logistics system.
