Beruflich Dokumente
Kultur Dokumente
Chapter 15
Inventory Control
OBJECTIVES
Inventory System Defined
Inventory Costs
Independent vs. Dependent Demand
Single-Period Inventory Model
Multi-Period Inventory Models: Basic
Fixed-Order Quantity Models
Multi-Period Inventory Models: Basic
Fixed-Time Period Model
Miscellaneous Systems and Issues
Inventory System
Inventory is the stock of any item or
resource used in an organization and
can include: raw materials, finished
products, component parts, supplies,
and work-in-process
An inventory system is the set of
policies and controls that monitor levels
of inventory and determines what levels
should be maintained, when stock
should be replenished, and how large
orders should be
Purposes of Inventory
1. To maintain independence of operations
2. To meet variation in product demand
3. To allow flexibility in production
scheduling
4. To provide a safeguard for variation in
raw material delivery time
5. To take advantage of economic
purchase-order size
Inventory Costs
Holding (or carrying) costs
– Costs for storage, handling,
insurance, etc
Setup (or production change) costs
– Costs for arranging specific
equipment setups, etc
Ordering costs
– Costs of someone placing an order,
etc
Shortage costs
– Costs of canceling an order, etc
Finished
product
Dependent
Demand
(Derived demand
items for
E(1 component
) parts,
subassemblies,
Component parts raw materials,
etc)
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8
Inventory Systems
Single-Period Inventory Model
– One time purchasing decision (Example:
vendor selling t-shirts at a football game)
– Seeks to balance the costs of inventory
overstock and under stock
Multi-Period Inventory Models
– Fixed-Order Quantity Models
Event triggered (Example: running out of
stock)
– Fixed-Time Period Models
Time triggered (Example: Monthly sales call
by sales representative)
P
the
thesize
sizeofofthe
theinventory
inventoryso
P long
longasasthe
theprobability
probabilityof
of
so
C
Coo C
Cuu selling
sellingthe
equal
equalto
thelast
toor
lastunit
unitadded
orgreater
addedisis
greaterthan
thanthe
the
ratio
ratioof:
of:Cu/Co+Cu
Cu/Co+Cu
Where :
Co Cost per unit of demand over estimated
Cu Cost per unit of demand under estimated
P Probability that the unit will be sold
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10
Multi-Period Models:
Fixed-Order Quantity Model
Model Assumptions (Part 1)
Multi-Period Models:
Fixed-Order Quantity Model Model
Assumptions (Part 2)
Inventory holding cost is based on
average inventory
Number
of units
on hand Q Q Q
R
L L
2. Your start using
them up over time. 3. When you reach down to
Time a level of inventory of R,
R = Reorder point
Q = Economic order quantity you place your next Q
L = Lead time sized order.
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14
Total Cost
C
O
S
T Holding
Costs
Annual Cost of
Items (DC)
Ordering Costs
QOPT
Order Quantity (Q)
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15
Q
Q 22
2DS
2DS = 2(Annual
2(Annual DDem
em and)(Order
and)(Order oror Setup
Setup Cost)
Cost)
QQOPT =
OPT = =
HH Annual
Annual Holding
Holding Cost
Cost
__
We
Wealso
alsoneed
needaa RReorder
eorder point,
point, RR == dd LL
reorder
reorderpoint
pointto
to _
tell
tellus
uswhen
whento
to d = average daily demand (constant)
place
placeananorder
order L = Lead time (constant)
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17
Given
Given the
theinformation
information below,
below,what
what are
arethe
theEOQ
EOQand
and
reorder
reorder point?
point?
1,000
1,000 units
units // year
year = 2.74 units / day
dd == = 2.74 units / day
365 days / year
365 days / year
__
Reorder
Reorderpoint,
point, RR == dd LL== 2.74units
2.74units//day
day(7days)
(7days)==19.18
19.18 or
or 20
20 units
units
In
Insummary,
summary,youyouplace
placeananoptimal
optimalorder
orderof
of90
90units.
units. In
In
the
thecourse
courseof
ofusing
usingthe
theunits
unitsto
tomeet
meetdemand,
demand,when
when
you
youonly
onlyhave
have2020units
unitsleft,
left,place
placethe
thenext
nextorder
orderof
of9090
units.
units.
10,000
10,000 units
units// year
year = 27.397 units / day
dd == = 27.397 units / day
365 days / year
365 days / year
__
RR == dd LL== 27.397
27.397 units
units//day
day (10
(10 days)
days)== 273.97
273.97 or
or 274
274 units
units
Place
Placean
anorder
orderfor
for366
366units.
units. When
Whenin inthe
thecourse
courseofof
using
usingthe
theinventory
inventoryyou
youare
are left
left with
withonly
only274
274units,
units,
place
placethe
thenext
next order
orderofof366
366units.
units.
qq==dd(T L)++ZZTT++LL--II
(T++L)
Where
Where::
qq==quantitiy
quantitiyto
tobe
beordered
ordered
TT==the
thenumber
numberof ofdays
daysbetween
betweenreviews
reviews
LL==lead
leadtime
timeinindays
days
dd==forecast
forecast average
averagedaily
dailydemand
demand
zz==the
thenumber
numberofofstandard
standarddeviations
deviationsfor
foraaspecified
specifiedservice
serviceprobabilit
probabilityy
T + L ==standard
standarddeviation
deviationof
ofdemand
demandover
overthe
thereview
reviewand
andlead
leadtime
time
T +L
II==current
currentinventory
inventorylevel
level(includes
(includesitems
itemson
onorder)
order)
T+
T+LL 22
T+T+LL ==
i i 11
ddi
i
Since
Sinceeach
eachday
dayisisindependent anddd isisconstant,
independentand constant,
T+T+LL == (T + L) 22
(T + L)dd
The
The value
value for
for “z”
“z” isis found
found by
by using
using the
the Excel
Excel
NORMSINV
NORMSINV function,function, or or as
as wewe will
will do
do here,
here, using
using
Appendix
Appendix D. D. ByBy adding
adding 0.5 0.5 to
to all
all the
thevalues
values in
in
Appendix
Appendix D D and
and finding
finding thethe value
value in in the
the table
table that
that
comes
comes closest
closest to
to the
the service
service probability,
probability,the the“z”
“z”
value
value can
can be
be read
read by by adding
addingthe thecolumn
column heading
heading
label
label to
to the
the row
row label.
label.
So,
So,by
byadding
adding0.5
0.5to
tothe
thevalue
valuefrom
fromAppendix
AppendixDDof of0.4599,
0.4599,
we
wehave
haveaaprobability
probabilityofof0.9599,
0.9599,which
whichisisgiven
givenby
byaazz==1.75
1.75
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25
qq==20(30
20(30++10)
10)++(1.75)(25.
(1.75)(25.298)
298)--200
200
80044.272
qq==800 44.272--200
200==644.272,
644.272,or
or645
645units
units
So,
So, to
to satisfy
satisfy 96
96 percent
percent of
of the
the demand,
demand,
you
you should
should place
place an
an order
order of
of 645
645 units
units at
at
this
this review
review period
period
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26
Because
Becausethe
thetotal
total annual
annualcost
costfunction
functionis
is
Total aa“u”
“u”shaped
shapedfunction
function
annual
costs So
Sothe
thecandidates
candidates
for
forthe
theprice-
price-
breaks
breaksare
are1826,
1826,
2500,
2500,and
and4000
4000
units
units
0 1826 2500 4000 Order Quantity
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30
Finally,
Finally,we
weselect
selectthe
theleast
least costly
costlyQQopt , which is this
opt, which is this
problem
problem occurs
occursin
in the
the4000
4000 &&more
more interval.
interval. In
In
summary,
summary, our
ouroptimal
optimal order
orderquantity
quantityis is4000
4000units
units
Miscellaneous Systems:
Optional Replenishment System
Maximum Inventory Level, M
q=M-I
Miscellaneous Systems:
Bin Systems
Two-Bin System
Order Enough to
Refill Bin
Periodic Check
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33
End of Chapter 15