Forming an inventory control policy and Forecasting model for an E-commerce Company
(2019) MIOM05 20191Production Management
- Abstract
- Abstract
Title: Developing an Inventory Control Policy and Forecasting Model for an E-
Commerce Company
Authors: Patrik Lorentsson & Nilan Nabavieh
Supervisor: Johan Marklund, Department of Industrial Management and Logistics
Background:
Increasingly competitive business environments forces companies to
develop better control of the material flows in their supply chain. Inventories are often
kept in large amounts in order to buffer against uncertainties, resulting in high average
holding costs. An important part in controlling this flow of material and inventory is to
decide upon when to order and how much. Two important components when evaluating
these two, is the inventory policy used as well as the method of... (More) - Abstract
Title: Developing an Inventory Control Policy and Forecasting Model for an E-
Commerce Company
Authors: Patrik Lorentsson & Nilan Nabavieh
Supervisor: Johan Marklund, Department of Industrial Management and Logistics
Background:
Increasingly competitive business environments forces companies to
develop better control of the material flows in their supply chain. Inventories are often
kept in large amounts in order to buffer against uncertainties, resulting in high average
holding costs. An important part in controlling this flow of material and inventory is to
decide upon when to order and how much. Two important components when evaluating
these two, is the inventory policy used as well as the method of forecasting.
Purpose: Forming a basic inventory policy and forecasting model for the warehouse in
Sweden.
Research Questions: (1) How can the inventory policy for the warehouse in Sweden be
improved? (2) What is an adequate forecasting model for the purchasing department?
Methodology:
In this thesis, frameworks presented by Yin (2009) and Hillier &
Liebermann (2010) are used to construct the research approach. An initial analysis of the
problem presented was conducted in order to properly identify the intended problem.
Following this, an analytical analysis of gathered data was conducted to analyse the current
performance of the company. Finally, models based on well-known theory were
constructed to represent the new inventory policy and forecasting method.
Conclusion:
A simple inventory policy could be constructed. Lack of historical data and
previous analysis meant that an exact representation of the current situation could not be
constructed. The demand could be approximated to follow a normal distribution. As the
company currently orders in batches, a continuous review (R, Q) policy was chosen. It
was found that the inventory levels could be decreased in almost all cases when setting 95
% fill rate constraint. Due to lack of historical data, an adequate forecasting model could
not be decided upon. Instead Alternative Forecasting Application Models (AFAMs) representing the different models were developed for choosing a suitable forecasting
model in the future. (Less) - Popular Abstract
- Abstract
Title: Developing an Inventory Control Policy and Forecasting Model for an E-
Commerce Company
Authors: Patrik Lorentsson & Nilan Nabavieh
Supervisor: Johan Marklund, Department of Industrial Management and Logistics
Background:
Increasingly competitive business environments forces companies to
develop better control of the material flows in their supply chain. Inventories are often
kept in large amounts in order to buffer against uncertainties, resulting in high average
holding costs. An important part in controlling this flow of material and inventory is to
decide upon when to order and how much. Two important components when evaluating
these two, is the inventory policy used as well as the method of... (More) - Abstract
Title: Developing an Inventory Control Policy and Forecasting Model for an E-
Commerce Company
Authors: Patrik Lorentsson & Nilan Nabavieh
Supervisor: Johan Marklund, Department of Industrial Management and Logistics
Background:
Increasingly competitive business environments forces companies to
develop better control of the material flows in their supply chain. Inventories are often
kept in large amounts in order to buffer against uncertainties, resulting in high average
holding costs. An important part in controlling this flow of material and inventory is to
decide upon when to order and how much. Two important components when evaluating
these two, is the inventory policy used as well as the method of forecasting.
Purpose: Forming a basic inventory policy and forecasting model for the warehouse in
Sweden.
Research Questions: (1) How can the inventory policy for the warehouse in Sweden be
improved? (2) What is an adequate forecasting model for the purchasing department?
Methodology:
In this thesis, frameworks presented by Yin (2009) and Hillier &
Liebermann (2010) are used to construct the research approach. An initial analysis of the
problem presented was conducted in order to properly identify the intended problem.
Following this, an analytical analysis of gathered data was conducted to analyse the current
performance of the company. Finally, models based on well-known theory were
constructed to represent the new inventory policy and forecasting method.
Conclusion:
A simple inventory policy could be constructed. Lack of historical data and
previous analysis meant that an exact representation of the current situation could not be
constructed. The demand could be approximated to follow a normal distribution. As the
company currently orders in batches, a continuous review (R, Q) policy was chosen. It
was found that the inventory levels could be decreased in almost all cases when setting 95
% fill rate constraint. Due to lack of historical data, an adequate forecasting model could
not be decided upon. Instead Alternative Forecasting Application Models (AFAMs) representing the different models were developed for choosing a suitable forecasting
model in the future. (Less)
Please use this url to cite or link to this publication:
http://lup.lub.lu.se/student-papers/record/8993707
- author
- Lorentsson, Patrik LU and Nabavieh, Nilan
- supervisor
- organization
- course
- MIOM05 20191
- year
- 2019
- type
- M1 - University Diploma
- subject
- keywords
- Inventory Policy, Forecasting Model, Stochastic Demand, Optimisation
- language
- English
- id
- 8993707
- date added to LUP
- 2019-10-15 14:36:01
- date last changed
- 2019-10-15 14:36:01
@misc{8993707,
abstract = {{Abstract
Title: Developing an Inventory Control Policy and Forecasting Model for an E-
Commerce Company
Authors: Patrik Lorentsson & Nilan Nabavieh
Supervisor: Johan Marklund, Department of Industrial Management and Logistics
Background:
Increasingly competitive business environments forces companies to
develop better control of the material flows in their supply chain. Inventories are often
kept in large amounts in order to buffer against uncertainties, resulting in high average
holding costs. An important part in controlling this flow of material and inventory is to
decide upon when to order and how much. Two important components when evaluating
these two, is the inventory policy used as well as the method of forecasting.
Purpose: Forming a basic inventory policy and forecasting model for the warehouse in
Sweden.
Research Questions: (1) How can the inventory policy for the warehouse in Sweden be
improved? (2) What is an adequate forecasting model for the purchasing department?
Methodology:
In this thesis, frameworks presented by Yin (2009) and Hillier &
Liebermann (2010) are used to construct the research approach. An initial analysis of the
problem presented was conducted in order to properly identify the intended problem.
Following this, an analytical analysis of gathered data was conducted to analyse the current
performance of the company. Finally, models based on well-known theory were
constructed to represent the new inventory policy and forecasting method.
Conclusion:
A simple inventory policy could be constructed. Lack of historical data and
previous analysis meant that an exact representation of the current situation could not be
constructed. The demand could be approximated to follow a normal distribution. As the
company currently orders in batches, a continuous review (R, Q) policy was chosen. It
was found that the inventory levels could be decreased in almost all cases when setting 95
% fill rate constraint. Due to lack of historical data, an adequate forecasting model could
not be decided upon. Instead Alternative Forecasting Application Models (AFAMs) representing the different models were developed for choosing a suitable forecasting
model in the future.}},
author = {{Lorentsson, Patrik and Nabavieh, Nilan}},
language = {{eng}},
note = {{Student Paper}},
title = {{Forming an inventory control policy and Forecasting model for an E-commerce Company}},
year = {{2019}},
}