Inventory Management Advice

Making better use of the data in your inventory system

Stop Using Target Service Levels

Stop Using Target Service Levels

Using a target service level to set safety stocks prevents optimisation. That is because the optimum service level is different for different items. Using the same target service level for all items tends to produce results which are far from optimal. This problem is...
Exponential Smoothing and Inventory Management

Exponential Smoothing and Inventory Management

The technique described here is called “exponential smoothing”. It is a simple method of updating an average as new data becomes available. It is the basis of most techniques used for forecasting customer demands. It was discussed briefly in the article entitled...
Lead Time Analysis  –  Part 2

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...
Lead Time Analysis  –  Part 2

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...