Research on Multilevel Inventory Control of FMCG Industry Based on System Dynamics

2012 ◽  
Vol 157-158 ◽  
pp. 1212-1219
Author(s):  
Bin Yang ◽  
Shu Qin Li ◽  
Chao Zhang
Keyword(s):  
Supply Chain ◽  
System Dynamics ◽  
Inventory Control ◽  
Inventory Management ◽  
Dynamic Models ◽  
Service Level ◽  
System Dynamic ◽  
Good Prospect ◽  
Control Loop ◽  
Model And Simulation

In this paper, the method of system dynamics is applied for the supply chain inventory management in FMCG industry. Based on the analysis of three-level supply chain inventory control loop, this paper establishes system dynamic models related profits and the service level of 2&3-level supply chain. After testing the validity of the model, the writer does some simulation through the system dynamics software Vensim．In addition, the model and simulation described in the paper are highly understandable and practicable, and thus have a very good prospect of application.

scholarly journals A literature review on multi-echelon inventory management: the case of pharmaceutical supply chain

2018 ◽  
Vol 200 ◽  
pp. 00013 ◽  
Author(s):  
Nouçaiba Sbai ◽  
Abdelaziz Berrado
Keyword(s):  
Supply Chain ◽  
Customer Service ◽  
Inventory Management ◽  
Raw Materials ◽  
Integrated Approach ◽  
Service Level ◽  
Pharmaceutical Products ◽  
Management Problem ◽  
Pharmaceutical Supply Chain ◽  
Customer Service Level

Inventory management remains a key challenge in supply chain management. Many companies recognize the benefits of a good inventory management system. An effective inventory management helps reaching a high customer service level while dealing with demand variability. In a complex supply chain network where inventories are found across the entire system as raw materials or finished products, the need for an integrated approach for managing inventory had become crucial. Modelling the system as a multi-echelon inventory system allows to consider all the factors related to inventory optimization. On the other hand, the high criticality of the pharmaceutical products makes the need for a sophisticated supply chain inventory management essential. The implementation of the multi-echelon inventory management in such supply chains helps keeping the stock of pharmaceutical products available at the different installations. This paper provides an insight into the multi-echelon inventory management problem, especially in the pharmaceutical supply chain. A classification of several multi-echelon inventory systems according to a set of criteria is provided. A synthesis of multiple multi-echelon pharmaceutical supply chain problems is elaborated.

Modeling Closed Loop Supply Chain Systems

2012 ◽  
pp. 313-342
Author(s):  
Roberto Poles
Keyword(s):  
Supply Chain ◽  
System Dynamics ◽  
Supply Chains ◽  
Inventory Control ◽  
Production Planning ◽  
Closed Loop ◽  
Economic Benefits ◽  
Reverse Supply Chain ◽  
Closed Loop Supply Chains ◽  
Operational Processes

In the past, many companies were concerned with managing activities primarily along the traditional supply chain to optimize operational processes and thereby economic benefits, without considering new economic or environmental opportunities in relation to the reverse supply chain and the use of used or reclaimed products. In contrast, companies are now showing increased interest in reverse logistics and closed loop supply chains (CLSCs) and their economic benefits and environmental impacts. In this chapter, our focus is the study of remanufacturing activity, which is one of the main recovery methods applied to closed loop supply chains. Specifically, the authors investigate and evaluate strategies for effective management of inventory control and production planning of a remanufacturing system. To pursue this objective, they model a production and inventory system for remanufacturing using the System Dynamics (SD) simulation modeling approach. The authors primary interest is in the returns process of such a system. Case studies will be referred to in this chapter to support some of the findings and to further validate the developed model.

scholarly journals Visualized System Dynamics models as Information and Planning Tools

10.28945/2693 ◽  
2003 ◽  
Author(s):  
Hanne-Lovise Skartveit ◽  
Katherine J. Goodnow ◽  
Magnhild Viste
Keyword(s):  
System Dynamics ◽  
Dynamic Models ◽  
System Dynamic ◽  
Time System ◽  
Management Tools ◽  
Client Group ◽  
Stocks And Flows ◽  
Graphic Complexity ◽  
New Research ◽  
Dynamics Models

In this paper, we describe the use of visualization of system dynamics models as client information and management tools. System dynamics is a methodology for analyzing and understanding how complex systems change over time. System dynamic models have been developed for a broad range of information to client applications - from resource management problems to the mapping of stocks and flows on factory floors. The problem faced by many users of system dynamic models is their graphic complexity for users not trained in the field. This paper addresses new research into visualization of system dynamics models to make client information more efficient and accessible. This research involves the use of narrative, video and sound embedded in statistical material. This paper also considers one particular client group - that of politicians, planners and civil society in developing countries.

scholarly journals Comparing continuous control policies by modeling and simulation of the procurement process

2020 ◽  
Vol 9 (1) ◽  
pp. 211
Author(s):  
Abdessamad Douraid ◽  
Hamid Ech-Cheikh ◽  
Khalid El Had ◽  
Mohamed Laradi
Keyword(s):  
Supply Chain ◽  
Inventory Control ◽  
Inventory Management ◽  
Discrete Event ◽  
Control Policy ◽  
Problem Area ◽  
Continuous Control ◽  
Control Policies ◽  
Procurement Process ◽  
The Right

Inventory management is a challenging problem area in supply chain management and companies need to have inventories in warehouses in order to satisfy customer's needs. Meanwhile, these inventories have holding costs and this is a frozen fund that can be lost. Therefore, the task of inventory management is to find the right quantity of inventories that will fulfill the demand with the right price, avoiding overstocks. The aim of this paper is to carry out a comparing study of continuous inventory control policies in a stochastic environment of demand and lead time, in order to find out the impacts of the decision variables of each inventory control policy. For this purpose, the discrete event simulation approach has been chosen to generate various scenarios of inventory control policies of the procurement process by taking into account the production planning of the manufacturing company. The comparison of these configurations based on the essential key performance indicators of the supply chain, namely the cost and service level.  

Inventory Control and Replenishment of Multi-Product Multi-Echelon Based on Time Cost Under JMI Environment

2013 ◽  
Vol 5 (2) ◽  
pp. 19-30
Author(s):  
Zhi Chen ◽  
Chao Ren ◽  
Ren-long Zhang ◽  
Mi-Yuan Shan
Keyword(s):  
Supply Chain ◽  
Inventory Management ◽  
Service Level ◽  
Control Model ◽  
Management Tool ◽  
Time Cost ◽  
Inventory Cost ◽  
Inventory Costs ◽  
Total Inventory ◽  
Replenishment Strategy

Joint managed inventory is an advanced supply chain inventory management tool, which will effectively tackle the complicated problem between the inventory cost of supply chain and service level. The research on inventory model and its’ control under JMI environment is a hot issue at present. In this paper, the authors deeply discuss the question of the inventory time costs about the multi-product and multi-echelon control model and its’ replenishment strategy under JMI environment. With considering the foundation of JMI and time cost, the authors propose the multi-product multi-echelon inventory cost control model under time cost. Then formulate corresponding replenishment strategy. At last, through a numerical example, the authors discover that the multi-product multi-echelon joint inventory management based on time cost can effectively reduce the total inventory costs and improve the competitiveness of the entire supply chain.

scholarly journals System dynamics comparison of three inventory management models in an automotive parts supply chain

2017 ◽  
Vol 11 ◽  
Author(s):  
Andries Botha ◽  
Jacomine Grobler ◽  
V.S. Sarma Yadavalli
Keyword(s):  
Supply Chain ◽  
System Dynamics ◽  
Inventory Management ◽  
Bullwhip Effect ◽  
Dynamics Simulation ◽  
Management Approach ◽  
Damping Factor ◽  
Theoretical Derivation ◽  
Automotive Parts ◽  
Moving Parts

Background: The automotive parts supply chain measures its success in terms of parts availability and stock required to achieve the availability target, measured as allocation fill rate (AFR). The supply chain strives to achieve an AFR target of 95.5% while maintaining low levels of stock.Objective: The first objective of this study is to evaluate the current inventory management approach, namely the maximum inventory position (MIP) method, to understand the difference between the theoretical derivation and the actual implementation. The second objective is to develop and compare the performance of a new stock target setting (STS) method relative to the MIP methods.Method: The theoretical and actual equations behind the MIP and STS methods are derived for steady state as well as stochastic conditions. A system dynamics simulation model (SDSM) was developed to describe both the local and imported supply chains. The SDSM was used to simulate and confirm the parameters for the STS method. It was also used to compare the three inventory management methods against a theoretical environment and actual data sets.Results: The STS method requires a damping factor (DF) to ensure it does not cause the bullwhip effect. The SDSM was used to determine that a value equal to the lead time ensures effective damping. In the theoretical environment, the MIPTheory method requires the lowest stock, but also has the lowest AFR. MIPActual achieves the highest AFR, but with significantly higher stock holding. The STS method improves on the AFR achieved by the MIPTheory method, with lower stock holding than the MIPActual method. With the actual demand data sets, the results vary by parts movement type. With fast moving parts, all methods achieve the AFR target, the MIPActual method has a higher stock holding for all cases, and the STS method results in reduced stock holding for 7 of 12 cases. With medium moving parts, the MIPActual method improves on the AFR in all 15 cases, but with significantly higher stock. The STS method increases the AFR in 7 of 15 cases and reduces the stockholding in 11 of 15 cases. With slow moving parts, both the MIPActual and STS methods improve the AFR with increased stock holding. The increase in stock holding for the STS method is significantly lower. With erratic moving parts, the MIPActual method improves on the AFR in all 17 cases, but requires significantly higher stock holding. The STS method achieves lower AFR values in 10 of 17 cases, but also requires lower or equal stock holding in 10 of 17 cases.Conclusion: The STS method provides a new approach to inventory management in the automotive supply chain. It provides improved performance for lower stock holding than the implemented MIP method (MIPActual). The results for the different movement category suggest that there is further research to be done to confirm the effectiveness of the various methods with other demand distributions.

Inventory Control Policy of Service Parts under the Background of Service-Embedded Manufacturing

2011 ◽  
Vol 201-203 ◽  
pp. 2509-2512
Author(s):  
Peng Peng Wang ◽  
Xin Guo Ming ◽  
Dong Zhang ◽  
Dong Li ◽  
Zhen Yong Wu
Keyword(s):  
Inventory Control ◽  
Inventory Management ◽  
Control Policy ◽  
Service Level ◽  
Manufacturing Firms ◽  
Control Parameters ◽  
Service Market ◽  
Service Parts ◽  
Maximum Profit ◽  
Inventory Control Policy

This paper studied service parts inventory control policy of a large equipment manufacturer which is on the transformation to service-embedded manufacturing. In order to get win-win solution for both supplier and client, a new cooperation pattern of service parts management was proposed. And a service parts model of multi-echelon inventory system in the after-sale service market was build based on the analysis of service parts demand under servitizaion. Based on this model, many issues of service parts inventory management were studied. Finally the inventory control parameters were exploited which aims at the maximum profit of service parts inventory. With this method, the reduced inventory of suppliers and improved service level could be calculated quantitatively, which could work as a reference to set price of extensional services. Experiments showed the method proposed in this paper is valid for service-embedded manufacturing firms.

scholarly journals Control Theory Concepts Applied to Retail Supply Chain: A System Dynamics Modeling Environment Study

2013 ◽  
Vol 2013 ◽  
pp. 1-14 ◽  
Author(s):  
Balaji Janamanchi ◽  
James R. Burns
Keyword(s):  
Supply Chain ◽  
Control Theory ◽  
System Dynamics ◽  
Objective Function ◽  
Inventory Management ◽  
Dynamics Modeling ◽  
Modeling Methodology ◽  
Performance Functional ◽  
Environment Study ◽  
The Right

Control theory concepts have been long used to successfully manage and optimize complex systems. Using system dynamics (SD) modeling methodology, which is continuous deterministic simulation modeling methodology, we apply control theory concepts to develop a suitable performance functional (or objective function) that optimizes the performance of a retail supply chain. The focus is to develop insights for inventory management to prevent stock-outs and unfilled orders and to fill customer orders at the lowest possible cost to supply chain partners under different scenarios, in a two-player supplier-retailer supply chain. Moderate levels of inventory, defining appropriate performance functional, appear to be crucial in choosing the right policies for managing retail supply chain systems. The study also demonstrated how multiple objectives can be combined in a single performance functional (or objective function) by carefully assigning suitable weights to the components of objectives based on their priority and the existence of possible trade off opportunities.

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