Академический Документы
Профессиональный Документы
Культура Документы
Inventory
Replenishment
order
Factory
Production
Delay
Replenishment Replenishment
order
order
Wholesaler
Distributor
Shipping
Delay
Wholesaler
Inventory
Retailer
Shipping
Delay
Distributor
Inventory
Customer
order
Customer
Item Withdrawn
Retailer
Inventory
Learning Objectives
Role of Inventory
Decoupling inventories
Seasonal inventories
Speculative inventories
Cyclical inventories
In-transit inventories
Safety stocks
18-3
Considerations in Inventory
Systems
Ordering costs
Shortage costs
18-5
Inventory Management
Questions
18-6
Inventory Models
17-8
R = Reorder point
Q = Economic order quantity
L = Lead time
Time
L
3. When you reach down to
a level of inventory of R,
you place your next Q
sized order.
17-9
Total
Annual
Annual
Annual
Annual = Purchase + Ordering+ Holding
Cost
Cost
Cost
Cost
D
Q
D
Q
TC
TC == DC
DC ++ SS++ H
H
Q
22
Q
TC=Total
TC=Totalannual
annual
cost
cost
DD=Demand
=Demand
CC=Cost
=Costper
perunit
unit
QQ=Order
=Order
quantity
quantity
SS=Cost
=Costof
of
placing
placingan
anorder
order
or
orsetup
setupcost
cost
RR=Reorder
=Reorderpoint
point
LL=Lead
=Leadtime
time
H=Annual
H=Annual
holding
holdingand
and
storage
storagecost
costper
per
unit
unitof
ofinventory
inventory
18-10
17-11
Using
Using calculus,
calculus, we
we take
take the
the first
first derivative
derivative
of
of the
the total
total cost
cost function
function with
with respect
respect to
to
Q,
Q, and
and set
set the
the derivative
derivative (slope)
(slope) equal
equal to
to
zero,
zero, solving
solving for
for the
the optimized
optimized (cost
(cost
minimized)
minimized) value
value of
of Q
Qopt
opt
QQOPT
=
OPT =
2DS
2DS =
=
HH
We
Wealso
alsoneed
needaa
reorder
reorderpoint
pointto
to
tell
tellus
uswhen
whento
to
place
placean
anorder
order
2(Annual
2(AnnualDemand)(Order
Demand)(Orderor
orSetup
SetupCost)
Cost)
Annual
AnnualHolding
HoldingCost
Cost
__
Reorder
Reorder point,
point, R
R == ddLL
17-12
Given
Giventhe
theinformation
informationbelow,
below,what
what are
arethe
theEOQ
EOQ and
and
reorder
reorderpoint?
point?
17-13
Q
=
QOPT
OPT =
2DS
2DS =
=
H
H
2(1,000
2(1,000)(10)
)(10) = 89.443 units or 90 units
= 89.443 units or 90 units
2.50
2.50
1,000
units
//year
1,000
units
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
19.18or
or 20
20units
units
In
Insummary,
summary,you
youplace
placean
anoptimal
optimalorder
orderof
of90
90units.
units. In
In
the
thecourse
courseof
ofusing
usingthe
theunits
unitsto
tomeet
meetdemand,
demand,when
when
you
youonly
onlyhave
have20
20units
unitsleft,
left,place
placethe
thenext
nextorder
orderof
of90
90
units.
units.
17-14
Determine
Determine the
the economic
economic order
order quantity
quantity
and
and the
the reorder
reorder point
point given
given the
the
following
following
Annual Demand = 10,000 units
Days per year considered in average
daily demand = 365
Cost to place an order = $10
Holding cost per unit per year = 10%
of cost per unit
Lead time = 10 days
Cost per unit = $15
17-15
2DS
2(10,000
)(10)
2DS
2(10,000
)(10) = 365.148 units, or 366 units
Q
=
=
QOPT
=
= 365.148 units, or 366 units
OPT =
H
1.50
H
1.50
10,000
units
//year
10,000
units
year = 27.397 units / day
dd==
= 27.397 units / day
365
days
/
year
365 days / year
__
R
R ==dd LL==27.397
27.397units
units//day
day(10
(10days)
days)==273.97
273.97or
or 274
274units
units
Place
Placean
anorder
orderfor
for366
366units.
units. When
Whenin
in the
thecourse
courseof
of
using
usingthe
theinventory
inventoryyou
you are
areleft
left with
with only
only274
274units,
units,
place
placethe
thenext
next order
orderof
of366
366units.
units.
17-16
Q OPT
2DS
2(Annual Demand)(Order or Setup Cost)
=
=
iC
Annual Holding Cost
17-17
A
Acompany
company has
has aa chance
chance to
to reduce
reduce their
theirinventory
inventory
ordering
ordering costs
costs by
by placing
placing larger
largerquantity
quantity orders
orders using
using
the
the price-break
price-breakorder
orderquantity
quantity schedule
schedule below.
below. What
What
should
should their
theiroptimal
optimal order
orderquantity
quantity be
be ifif this
this company
company
purchases
purchases this
this single
single inventory
inventoryitem
item with
with an
an e-mail
e-mail
ordering
ordering cost
cost of
of $4,
$4, aa carrying
carrying cost
cost rate
rate of
of 2%
2%of
of the
the
inventory
inventory cost
cost of
of the
the item,
item, and
and an
an annual
annual demand
demand of
of
10,000
10,000 units?
units?
Order Quantity(units) Price/unit($)
0 to 2,499
$1.20
2,500 to 3,999 1.00
4,000 or more .98
17-18
Q OPT =
2DS
=
iC
2(10,000)(4)
= 1,826 units
0.02(1.20)
Q OPT =
2DS
=
iC
2(10,000)(4)
= 2,000 units
0.02(1.00)
Q OPT =
2DS
=
iC
2(10,000)(4)
= 2,020 units
0.02(0.98)
17-19
Since
Sincethe
thefeasible
feasiblesolution
solution occurred
occurredin
inthe
thefirst
firstpricepricebreak,
values occur
break,itit means
means that
thatall
all the
theother
othertrue
trueQ
Qopt
opt values occur
at
at the
thebeginnings
beginningsof
ofeach
eachprice-break
price-breakinterval.
interval. Why?
Why?
Because
Becausethe
thetotal
total annual
annualcost
costfunction
functionis
is
aau
ushaped
shapedfunction
function
Total
annual
costs
So
So the
thecandidates
candidates
for
forthe
thepricepricebreaks
breaks are
are1826,
1826,
2500,
2500,and
and4000
4000
units
units
0
1826
2500
4000
Order Quantity
17-20
Next,
values into the total cost
Next,we
weplug
plugthe
thetrue
trueQ
Qopt
opt values into the total cost
annual
annualcost
costfunction
functionto
todetermine
determinethe
thetotal
total cost
costunder
under
each
eachprice-break
price-break
D
Q
D
Q iC
TC
=
DC
+
S
+
TC = DC +
S+
iC
Q
2
Q
2
TC(0-2499)=(10000*1.20)+(10000/1826)*4+(1826/2)(0.02*1.20)
TC(0-2499)=(10000*1.20)+(10000/1826)*4+(1826/2)(0.02*1.20)
==$12,043.82
$12,043.82
TC(2500-3999)=
TC(2500-3999)=$10,041
$10,041
TC(4000&more)=
TC(4000&more)=$9,949.20
$9,949.20
Finally,
, which is this
Finally,we
weselect
select the
theleast
least costly
costlyQ
Qopt
opt, which is this
problem
problem occurs
occursin
in the
the4000
4000 &&more
more interval.
interval. In
In summary,
summary,
our
ouroptimal
optimal order
orderquantity
quantityis
is4000
4000units
units
Questions
18.7
18.9
A.D. Small Consulting
u=3
u=3
15
.
15
.
15
.
u=3
u=3
d L 12
ROP
ss
18-22
Std . Dev.( L ) LT
SS zr LT
Reorder Point
ROP SS d L
18-23
Safety stock, SS
d1
Inventory on hand
EOQ
d3
d2 EOQ
First lead
time, LT1
Order 1 placed
LT2
LT3
Time
Order 2 placed
Shipment 1 received
Order 3 placed
Shipment 2 received
Shipment 3 received
18-24
Review period
RP
RP
RP
Q3
Q2
d3
d1
d2
Safety stock, SS
LT2
LT3
Time
Order 1 placed
Order 2 placed
Shipment 1 received
Order 3 placed
LT
ABC Classification of
Inventory Items
18-27
Unit cost
($)
Monthly
Sales
(units)
Home Theater
Computers
5000
2500
30
30
150,000
75,000
Television sets
Refrigerators
Displays
400
1000
250
60
15
40
24,000
15,000
10,000
Speakers
Cameras
Software
Thumb drives
CDs
150
200
50
5
10
60
40
100
1000
400
9,000
8,000
5,000
5,000
4,000
Totals
Percent of
Dollar
Dollar
Volume ($)
Volume
305,000
Percent of
SKUs
Class
20
16
30
10
50
100
100
74
18-28
Demand
Frequency
10
11
12
Demand
Frequenc
y
Probabili
ty
0.0278
0.0556
0.0833
0.1111
0.1389
0.1667
0.1389
0.1111
10
0.0833
11
0.0556
12
0.0278
p(D)
.028
.055
.083
.111
.139
.167
.139
.111
.083
.055
.028
Expected Profit
2
3
4
5
6
7
8
9
10
11
12
4
12
20
28
36
36
36
36
36
36
36
2
10
18
26
34
42
42
42
42
42
42
$31.54
$34.43
Stock Q
8
0
8
16
24
32
40
48
48
48
48
48
$35.77
10
-2
6
14
22
30
38
46
54
54
54
54
-4
4
12
20
28
36
44
52
60
60
60
$35.99
$35.33
18-32
Demand
Frequenc
y
Probabili
ty
P (D<Q)
0.0278
0.0556
0.0278
0.0833
0.0833
0.1111
0.1667
0.1389
0.2778
0.1667
0.4167
0.1389
0.5833
0.1111
0.7222
10
0.0833
10
0.8333
11
0.0556
11
0.9167
12
0.0278
12
0.9722
P( D Q)Cu P( D Q)Co
1 P( D Q) C
P ( D Q) Co
Cu
P ( D Q)
Cu Co
(Critical Fractile)
where:
Cu = unit contribution from newspaper sale ( opportunity cost of underestimating demand)
Co = unit loss from not selling newspaper (cost of overestimating demand)
D = demand
Q = newspaper stocked
18-34
0.722
18-35
Questions
Example 3 page 501
18.11
18.15
Case last resort restaurant
18-36
2.
3.
Tue.
Wed.
Thurs.
Fri.
250
275
260
300
290
235
250
295
310
360
2430
275
286
236
294
289
315
340
256
311
18-38