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http://dx.doi.org/10.9709/JKSS.2011.20.2.019

Impact of Smoothed Replenishment Ordering Policy on the Performance Measures in Supply Chain  

Cho, Myeon-Sig (경기대학교 산업경영공학과)
Publication Information
Journal of the Korea Society for Simulation / v.20, no.2, 2011 , pp. 19-27 More about this Journal
Abstract
This study investigates impact of smoothed replenishment ordering policy on the performance measures such as lead time, order fulfillment ratio, and inventory cost. We consider a two-echelon supply chain: a single retailer orders using smoothed order up to replenishment policy and a manufacturer produces the retailer's orders on a make to order basis. Simulation result confirms that lead time from the manufacturer can be reduced by smoothed ordering policy as expected. However, smoothing orders may deteriorate the customer order fulfillment ratio and inventory cost in a retailer. We also observe that variance of manufacturing time contributes more than mean of manufacturing time to both order fulfillment ratio and inventory cost. Therefore, variability of upstream manufacturing time should be minimized.
Keywords
Smoothed ordering policy; Lead time; Order fulfillment ratio; Inventory cost;
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