Kanjanaporn Pirunkran. Decision-support system for finished goods inventory management : a case study of pharmaceutical and service company. Master's Degree(Logistics and Supply Chain). Mahidol University. Mahidol University Library and Knowledge Center. : Mahidol University, 2021.
Decision-support system for finished goods inventory management : a case study of pharmaceutical and service company
Abstract:
The case companys finished product requirement planning is worked through the Enterprise Resource Planning (ERP) system. Currently, this company encounters with the problem that the order quantities of finished products generated by ERP does not meet the actual demand. This problem stems from (i) the different demand conditions from three channels as hospital groups, clinics, and drug stores (ii) the minimum order quantities and (iii) the company's policy by inventory levels cover only 2 months of sales forecasting. This problem resulted in large backorder orders which lead to high amount of payment for backorder penalty. To resolve this problem, a decision support system (DSS) for finished product order planning is developed to determine the optimal order quantities. Moreover, DSS utilizes the principles of ABC-FMS Matrix Analysis to category the finished products based on their values and sale frequencies including establishment for finished product ordering. The results of DSS implementation reports that the average finished products inventory level decreased to 16.7%, the backorder of finished product items dropped average to 19 items per month and the amount of payment for backorder penalty reduced to 50.0%. Additionally, DSS can enhance the efficiency of order and inventory management.