This research aimed to find economic order quantity and reorder point of the inventory in a retail store under the uncertainty of lead time and demand. From the past, the store manager purchased a large amount of inventory to fulfill the customer demand without the appropriate techniques, which led to over-inventory. The store had lost more than THB 1 Million per year from the excess inventory. The Monte Carlo Simulation was applied in this research in order to determine the purchase order policy with the selected best sales goods. The inventory goods was classified by using ABC analysis. This research was only focus on the class A goods because they affected almost all of the inventory cost. As a result, 10 best sales goods in class A were selected. Then collecting the data of the sales for those goods for 12 months. After simulated the data for all selected goods and gained the optimal order quantity by using Monte Carlo Simulation, it was found that the new economic order quantit.
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Indonesian Scholars Scientific Summit Taiwan Proceeding
Inventory is one of the main components in supply chain. However, it is not easy to design inventory policy under uncertainties. The frequent occurrence of overstocks increases the company's financial expenditure. Otherwise, stockout decreases customer satisfaction and damage the company's image. This study aims to provide monte carlo model to design inventory policy with the aim of maximizing net income with a variety of uncertainties, one of the uncertainties is defective product because of the travel from suppliers. To handle the complexity and uncertainty of problem, a Monte Carlo simulation is used with spreadsheet-based representation. To test the reliability of the model, guitar company is used as relevant use case with uncertainty adhered ‘the greater number of order quantity, the greater likely the defective guitar will be’. The verification & validation process, experimental design, and alternative selection are also done with statistical tests. Based on the simula.
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Transport & Logistics: The International Journal
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The importance of inventory management has been evident for a long time since inventories are not only necessary for operations, but they also contribute to customer satisfaction. However, holding inventory comes with costs such as inventory carrying cost and opportunity cost. Therefore, it is vital for a firm to find way to manage its inventory to maximize customer service, minimize total investment, and maintaining operation efficiency. Unfortunately, these three objectives are frequently in conflict with each other. In this paper, the author presents a simulation-based approach to evaluate the impact of continuous and periodic review policies on supply chain performance measures including cost and service level. This simulation model is served as an experimental platform for manager to evaluate diverse inventory policies for different products under different circumstances. For the case study company, continuous and periodic review policies provide relatively the same costs given the same service level. Furthermore, this paper also applies Design of Experiment (DOE) to an inventory simulation model. DOE is used to investigate factors that affect performance including variation in demand, lead time, and review interval, and to analyze the interaction of these factors. All three factors affect total costs but in different magnitude. Interaction between lead time and review interval is also significant. The results of the experimentation enables managers to gain better understanding of different inventory policies and be able to select the configuration that best suit the company's objective.
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International Journal of Simulation and Process Modelling
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Simulation is the imitation of a real-world operation or process over time. Warehouse inventory management played an important role in improving customer service and reducing stock outs. Managing warehouse inventory is a challenging task and to address this challenge, we use simulation application in warehouse inventory management. The purpose of this paper is to use simulation in managing inventory of A Building Materials Trading Company in United Arab Emir-ates (UAE). Firstly, we will develop a model to improve average inventory level, average lost sales, and percentage of customer's dissatisfaction for the main component in the company which is cement. Secondly, we verify and validate our developed model using Arena simulation software. Finally, some recommendations regarding reorder point, batch size and target stock will be given to improve overall warehouse inventory management system.
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You Dare is a Small and Medium Enterprise (SME) engaged in fashion, namely the sale of shoes. The problems that occurred in Dare are their limit on the amount of the shoes supply from suppliers and the inventory allocation policies are unplanned, so the profit is not maximized. This study simulates inventory allocation policy that Dare applies to see the impact on profits of Dare then proceed with the design of new system scenarios. The new scenario aims to implement policies more appropriately to increase the profits of Dare . Simulations are performed with ProModel software.The results of this study indicate that the policy of only using intuition cannot maximize the profits. An appropriate policy to increase profits of Dare is to consider the demand and cost allocation. Based on simulation results, Dare will only have an average profit of IDR 52.187.000, whereas if Dare uses the proposed policy, the average profit will increase to IDR 55.948.000 within two years.
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