TWO STOCK/INVENTORY OPTIMIZATION METHODS CONFRONTED
Journal Title: MANAGERIAL CHALLENGES OF THE CONTEMPORARY SOCIETY - Year 2017, Vol 1, Issue 10
Abstract
Inventory management and strategy represent a core process in logistics. Inventory related activities are considered important cost drivers. Logistics should be largely considered a very important source for competitive advantage among companies having specific logistics operations. Minimization of inventory costs must be part of the overall effort of optimizing the logistics costs. One of the ways to optimize inventories is to establish a certain level of the average stock to be held in the warehouse and this demeanor is to be repeated constantly and consistently for each product of the entire portfolio. This level of stock must ensure the least possible value of inventory stock having, this way, a positive impact of the total logistics cost. The paper starts from the so known EOQ method to optimize the stock level considering a practical example. Then, another approach is proposed having the same purpose. This new method is then compared with the first in terms of easiness of use and, more important, in terms of accuracy of results. Finally, the second method is validated and it can be taken into consideration as a viable alternative to the first method.
Authors and Affiliations
Cătălin Afrăsinei-Zevoianu
Keywords
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- EP ID EP274350
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