An Inventory System For Packaging Material Under The Probabilistic Demand Using Joint Replenishment Method At Cocoa Company

DOI

10.2991/icoiese-18.2019.54How to use a DOI?

Keywords

joint replenishment, economic order interval, economic order quantity, safety stock, reorder point, Inventor Turnover (ITO)

Abstract

Company XYZ is a company runs in the cocoa industry located in Bandung. Currently, Company XYZ has the problem in controlling inventory system of packaging materials because there is only one supplier who supply the material, variation of lead time, high stocks of packaging material that pile up in the warehouse. The purpose of this research to minimize the cost of total inventory, this system consists of three stages. First, determining the demand for packaging material and testing the distribution of demand, classification using ABC analysis and testing distribution of lead time. Second, determine the economic order interval and order quantity, safety stock and reorder point. Third, calculate the total inventory cost. Sensitivity analysis is performed to see the effect of the change of variable parameter input of ordering cost and holding cost to total inventory cost. Sensitivity analysis is performed with a range of 5% to 25%. Based on research that has been done, actual inventory system in this company is not efficient because the actual policy is still not optimal. It can be seen from the number of overstocks that generate high embedded costs, then the actual policy in Company XYZ need improvement. From the total 25 SKUs of material packaging, Inventory system proposed in this paper can save 83.24% that is Rp171,342,981,-. The proposed system that considers the variation of lead time has improved inventory performance.

Copyright

© 2019, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - Rafif Prayogi
AU  - Ari Yanuar Ridwan
AU  - Budi Santosa
PY  - 2019/03
DA  - 2019/03
TI  - An Inventory System For Packaging Material Under The Probabilistic Demand Using Joint Replenishment Method At Cocoa Company
BT  - Proceedings of the 2018 International Conference on Industrial Enterprise and System Engineering (IcoIESE 2018)
PB  - Atlantis Press
SP  - 303
EP  - 306
SN  - 2589-4943
UR  - https://doi.org/10.2991/icoiese-18.2019.54
DO  - 10.2991/icoiese-18.2019.54
ID  - Prayogi2019/03
ER  -