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Batch ordering inventory management under the mixed demand information: a case study

Batch ordering inventory management under the mixed demand information: a case study
Batch ordering inventory management under the mixed demand information: a case study
This study is concerned with analysing the past demand data and development of an inventory model with demand arising from deterministic which is known in advance and random sources simultaneously. Two different shortages are created for each demand type and in order to prevent model to backlog the deterministic demand, very high shortage cost is given for deterministic demand. The numerical value of the parameters are obtained from a real case which the inventory system of an information and technological organization of a university. The main difference of this study from the previous studies is that the order amount must be in palette quantity for a deterministic and stochasticdemand inventory problem. Under this constraint, an inventory model is developed and tested with several datasets. Assuming lead time as constant, the value of deterministic demand present in the system and impact of palette constraint are investigated. These investigations are compared with the status quo in the case study. It has seen that the palette quantity behaves as safety stock for high level random demand. Recommendations based on the impacts of advance demand information, lead time and pallet quantity are presented in terms of changing in ordering costs, holding costs and service level.
2667-8055
666-677
Alim, Muzaffer
fb85c754-4573-4548-afc7-7ba1ed73f20a
Beullens, Patrick
893ad2e2-0617-47d6-910b-3d5f81964a9c
Alim, Muzaffer
fb85c754-4573-4548-afc7-7ba1ed73f20a
Beullens, Patrick
893ad2e2-0617-47d6-910b-3d5f81964a9c

Alim, Muzaffer and Beullens, Patrick (2020) Batch ordering inventory management under the mixed demand information: a case study. Konya Journal of Engineering Sciences, 8 (3), 666-677. (doi:10.36306/konjes.599332).

Record type: Article

Abstract

This study is concerned with analysing the past demand data and development of an inventory model with demand arising from deterministic which is known in advance and random sources simultaneously. Two different shortages are created for each demand type and in order to prevent model to backlog the deterministic demand, very high shortage cost is given for deterministic demand. The numerical value of the parameters are obtained from a real case which the inventory system of an information and technological organization of a university. The main difference of this study from the previous studies is that the order amount must be in palette quantity for a deterministic and stochasticdemand inventory problem. Under this constraint, an inventory model is developed and tested with several datasets. Assuming lead time as constant, the value of deterministic demand present in the system and impact of palette constraint are investigated. These investigations are compared with the status quo in the case study. It has seen that the palette quantity behaves as safety stock for high level random demand. Recommendations based on the impacts of advance demand information, lead time and pallet quantity are presented in terms of changing in ordering costs, holding costs and service level.

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More information

Accepted/In Press date: 25 April 2020
Published date: 3 September 2020

Identifiers

Local EPrints ID: 448731
URI: http://eprints.soton.ac.uk/id/eprint/448731
ISSN: 2667-8055
PURE UUID: 4529e7a1-a612-4072-86da-99dcc2f515a2
ORCID for Patrick Beullens: ORCID iD orcid.org/0000-0001-6156-3550

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Date deposited: 04 May 2021 16:38
Last modified: 13 Dec 2021 03:01

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Contributors

Author: Muzaffer Alim

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