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Essentially, blood banks are facilities which procure, store, process, and dispense blood. To operate effectively in the face of both random supply and random demand, sizable buffer stocks of blood are maintained. The resulting inventory control problem is an extremely complex one for several reasons: (1) both supply and demand are random; (2) approximately 50 percent of all bloods demanded, "crossmatched," and held for a particular patient are eventually found not to be required for that patient; (3) blood is perishable, the present legal lifetime being 21 days in most areas; and (4) each blood bank typically interacts with a number of other banks. This paper presents a framework for the analysis of the whole blood inventory problem at the individual hospital as well as at the regional level; presents a realistic model of blood inventories for both the individual and regional cases; and analyzes the effects of several alternative inventory policies.

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