Patent ID: 8732039

Claim:
A method, comprising: performing, by one or more computing devices, each including at least a processor and a memory, identifying, by at least one of the one or more computing devices, a total number of units of an item to be stored in a plurality of regions; determining, by at least one of the one or more computing devices, an order forecast for the item in each of the plurality of regions, wherein determining the order forecast for the item includes linearly partitioning a probabilistic model of an order forecast distribution among the plurality of regions dependent upon respective parameters corresponding to the plurality of regions, wherein for each of the regions, the respective parameter includes one or more of a shape parameter or a scale parameter of the probabilistic model of the order forecast distribution; receiving, by at least one of the one or more computing devices, a unit out-of-stock cost of the item in each of the plurality of regions, wherein for a given one of the plurality of regions, the unit out-of-stock cost of the item in the given region indicates a cost of fulfilling a unit of the item in the event that the item is out-of-stock in the given region; calculating, by at least one of the one or more computing devices, an expected cost for each of the plurality of regions based, at least in part, on the total number of units of the item, each region's respective order forecast, and each region's respective unit out-of-stock cost; and allocating, by at least one of the one or more computing devices, respective portions of the total number of units of the item to each of the plurality of regions to reduce a sum of the expected costs, such that the allocating reduces expected costs specifically due to the item being out-of-stock in the plurality of regions, wherein allocating a particular portion of the total number of units of the item to the given region comprises instructing that the particular portion of the total number of units of the item be physically stored within the given region prior to the particular portion of the total number of units being used to fulfill a customer order.