Abstract: After putting forward a lead-time reduction cost function with characteristics of subsection linear,this paper discussed a two-stage(Q,r)policy coordination problem with service level constraint.By applying some means of optimization theory,the problem was decomposed into two problems:one problem without constraint and the other with equation constraint.Theoretic analysis and numerical study show that,service level can be improved prominently and the total cost can be minimized synchronously after confirming the order quantity,the reorder point and the lead-time expediting factor.

Key words: (Q,r)inventory models, lead-time reduction, service lever