东华大学供应链管理课件Chapter 3 Inventory Management.pptVIP

Chapter 3 Inventory Management, Supply Contracts and Risk Pooling Qi Xu Professor of Donghua University Tel: 021E-mail: xuqi@dhu.edu.cn Outline of the Presentation 3.1 Introduction to Inventory Management 3.2 Single Warehouse Inventory (1) EOQ (2) Demand Forecast (3) Supply Contracts (4) A multi-Period Inventory Model (5) Periodic Review Policy 3.3 Risk Pooling 3.4 Centralized vs. Decentralized Systems 3.5 Managing Inventory in the SC 3.6 Practical Issues in Inventory Management Case: JAM Electronics: Service Level Crisis JAM Electronics is a Korean manufacturer of products such as industrial relays.The company has five manufacturing facilities in different countries in the Far East with headquarters in Seoul,South Korea. JAM produces about 2,500 different products, all of them manufactured in the Far East. Finished products are stored in a central warehouse in Korea and are shipped from there to different countries. Items sold in the US are transported by ship to the warehouse in Chicago. Case: JAM Electronics Problems: the service level is at an all-time low. Only about 70% of all orders are delivered on time. Difficulty forecasting customer demand. Long lead time in the supply chain. The large number of SKUs handled by JAM USA. Case: JAM Electronics By the end of this chapter, you should be able to understand the following issues: How a firm can cope with huge variability in customer demand. What the relationship is between service and inventory levels. What an effective inventory management policy is. 4.1 Inventory Where do we hold inventory? Suppliers and manufacturers warehouses and distribution centers retailers Types of Inventory WIP raw materials finished goods Why do we hold inventory? Economies of scale Uncertainty in supply and demand Lead Time, Capacity limitations Goals: Reduce Cost, Improve Service By effectively managing inventory: Xerox eliminated $700 million inventory from its supply chain Wal-Mart became the largest r