Abstract:
This research aims to find the suitable ordering policy for a light bulb company using Monte Carlo simulation technique. The case study company faces the high inventory management cost due to raw material ordering policy do not match for demand. The present inventory management causes excess inventory level. Therefore, researcher proposes an appropriate inventory policy under uncertainty of demand leads to lower inventory cost. The study focuses from analysis product groups with ABC classification system and selected group A only by using (s, Q) and (s, S) model. The suitable policy is (s, S) model. Then take the result compared with conventional method. These results show that the proposed policy decrease total cost 87,489,808 bath per year equivalent to 8.69% and increase inventory turnover 12.45 cycles.