Determination of Optimum Inventory Model for Minimizing Total Inventory Cost

In most of the medium scale industries, demand is uncertain and difficult to forecast. Hence Ordering in right quantities at right time is always a crucial issue. In this paper; the authors present a model for determining the ordering policy which will minimize the total inventory cost. This paper t...

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Bibliographic Details
Published in:Procedia engineering 2013, Vol.51, p.803-809
Main Authors: Samak-Kulkarni, S.M., Rajhans, N.R.
Format: Article
Language:English
Subjects:
EOQ
Inventory costs
Inventory Models
LFL
LPC
LTC
LUC
POQ
Wagner-Whitin Algorithm
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Summary:In most of the medium scale industries, demand is uncertain and difficult to forecast. Hence Ordering in right quantities at right time is always a crucial issue. In this paper; the authors present a model for determining the ordering policy which will minimize the total inventory cost. This paper takes into consideration various models such as lot by lot size, economic order quantity, periodic order quantity, least unit cost, least total cost, least period cost, Wagner-Whitin algorithm etc. Total annual inventory costs for various items are calculated by each method. The results obtained by applying each model for different items are summarized which shows that Wagner-Whitin algorithm gives optimum cost in each case.
ISSN:1877-7058
1877-7058
DOI:10.1016/j.proeng.2013.01.115