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Lead Time Analysis – Part 2

This article contains information concerning the mathematics involved in the spreadsheets which are described in Part 1. That article was revised on 5 March 2017 and the spreadsheets were revised on 19 February 2017. It is assumed that the readers of this article have some knowledge of statistical mathematics. Any row which is concerned with […]

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Calendar

Lead Time Analysis – Part 1

Replenishment decisions rely on forecasts of lead times amongst other things. If the mean lead time for an item is not expected to change much then the average of recent lead times for the item can be used. Unless that item is purchased frequently, there won’t be many lead times to use for averaging purposes. […]

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Dice suggesting Monte Carlo simulation

Monte Carlo Simulator – Part 2

This article contains detailed information concerning the online Monte Carlo inventory management simulator which can be accessed by clicking on the “Simulator” tab in the menu at the top of the page. In parts of this article, it will be assumed that the reader has some knowledge of statistics. If you don’t have a statistical […]

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Croston Median

Demand Rate Estimation

Introduction If there is no evidence of trend or seasonal effects then forecasting using demand history alone usually simply involves estimation of the demand rate (mean demand per unit time). All of the algorithms mentioned in this article can be used as a basis for forecasting involving trend and seasonal effects. The performance of each […]

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Effects of relatively high demands on ordering

Evaluating Forecasting Algorithms

Introduction In order to determine when and how much of an item to order, it is necessary to have a forecast of customer demands. The human brain is not as good as appropriate statistical analysis at interpreting statistical data. Forecasting of customer demands using demand history alone is, therefore, better done by a computer using […]

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