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A Computation Model of the Quantity Supplied to Optimize Inventory Costs for Fast Fashion Industry  

Park, Hyun-Sung (Department of e-Business Management, Hanyang University)
Park, Kwang-Ho (Department of Business Administration, Hanyang University)
Kim, Tai-Young (School of Management, Dongyang Mirae University)
Publication Information
Journal of Korean Society of Industrial and Systems Engineering / v.35, no.1, 2012 , pp. 66-78 More about this Journal
Abstract
This paper proposes a computation model of the quantity supplied to optimize inventory costs for the fast fashion. The model is based on a forecasting, a store and production capacity, an assortment planning and quick response model for fast fashion retailers, respectively. It is critical to develop a standardized business process and mathematical model to respond market trends and customer requirements in the fast fashion industry. Thus, we define a product supply model that consists of forecasting, assortment plan, store capacity plan based on the visual merchandising, and production capacity plan considering quick response of the fast fashion retailers. For the forecasting, the decomposition method and multiple regression model are applied. In order to optimize inventory costs. A heuristic algorithm for the quantity supplied is designed based on the assortment plan, store capacity plan and production capacity plan. It is shown that the heuristic algorithm produces a feasible solution which outperforms the average inventory cost of a global fast fashion company.
Keywords
Fast Fashion; SPA; Forecasting Assortment Plan; Sales Capacity; Production Capacity;
Citations & Related Records
Times Cited By KSCI : 3  (Citation Analysis)
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