COMMERCE 2OC3 Chapter Notes - Chapter 12: Service Level, Statistical Model, Safety Stock
9 Apr 2017
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Document Summary
Abc analysis: a method for dividing on-hand inventory into three classifications based on annual dollar volume. Cycle counting: a continuing reconciliation of inventory with inventory records. Shrinkage: retail inventory is unaccented for between receipt and sale. Holding cost: the cost to keep or carry inventory in stock. Ordering cost: the cost of the ordering process. Setup cost: the cost to prepare a machine or process from production. Setup time: the time required to prepare a machine or process for production. Inventory models for independent demand: the basic economic order quantity (eoq) model. Economic order quantity (eoq) model: an inventory-control technique that minimizes the total of ordering and holding costs. Robust: giving satisfactory answers even with substantial variation in the parameters. Lead time: in purchasing systems, the time between placing an order and receiving it; in production systems, the wait, move, queue, setup, and run times for each component produced.
