Publication:
Wholesale level reorder point and reorder quantity computation during periods of declining demand

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Authors
Lilli, Charles M.
Husson, Charles R.
Subjects
Inapplicable Inventory
Inventory Model
Reorder Point Computation
Reorder Quantity Computation
Consumable Items
Advisors
Moore, Thomas P.
Date of Issue
1992-12
Date
1992-Dec
Publisher
Monterey, California. Naval Postgraduate School
Language
en_US
Abstract
For several decades the U.S. Navy has used a set of specific mathematical inventory models to help wholesale item managers make management decisions concerning consumable items of material. Implicit in these models is the assumption that the mean of quarterly demand for an item remains constant over time. This assumption is violated often, particularly during periods of force reduction or when equipment is retired. When this declining demand pattern occurs, the inventory models usually keep stock levels too high. This results in excess material known as inapplicable inventory. Recently, inapplicable inventory in the Navy was estimated to be as high as 10.4 billion dollars. Navy logisticians have invested a great deal of effort in solving this problem, mainly by focusing on forecasting. While improved forecasting may reduce inapplicable inventory to some extent, it will not, by itself, solve the problem This research has explored the problem of inapplicable inventory, its model- based causes and alternative solutions. The resulting inventory model, designed to work easily within the existing Navy UICP inventory information system, significantly reduced inapplicable inventory in several simulations which were run in this research
Type
Thesis
Description
Series/Report No
Department
Administrative Sciences
Other Units
Identifiers
NPS Report Number
Sponsors
Funder
Format
120 p.: ill;28 cm.
Citation
Distribution Statement
Approved for public release; distribution is unlimited.
Rights
This publication is a work of the U.S. Government as defined in Title 17, United States Code, Section 101. Copyright protection is not available for this work in the United States.
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