Page 102 - Orlicky's Material Requirements Planning

CHAPTER 4 Inventory in a Manufacturing Environment 81

FIGURE 4-23

Personal-care
item analysis. Actual Inventory Turns Days Forward Covered

Whse # Service Level
Average Inventory $s
1 99.0% 11.2 $ 29,47
2 99.3% 5.1 $ 59,84
3 99.3% 9.5 $ 66,04
4 99.5% 6.3 $ 94.28
5 99.3% 5.4 $ 52,71
6 98.1% 18.5 $ 26,19
7 98.7% 9.6 $ 51,68
8 97.8% 9.3 $ 57,14
Combined Warehouses 98.9% 7.1 $ 437,38
Plant (Central Buffer) 99.4% 10.7 $ 672,51
Av. Daily Open Supply $ 159,71
Consolidated Results 17.8 98.8% 20.6 $ 1,269,61
Actual Performance 11.8 98.0% 13.4 $ 2,574,68
Difference 6.0 0.9% 39% 1,305,06
% Reduction 51% 51%

BIBLIOGRAPHY

E. Goldratt, E. Schragenheim, and C. Ptak. “Necessary But Not Sufficient,” 2000.
Orlicky, J. A. “Requirements Planning Systems: Cinderella’s Bright Prospects for the Future,” in
Proceedings of the 13th International Conference of APICS. Great Barrington, MA: North River Press,
1970.
Wight, O. W. “To Order Point or Not to Order Point,” Production & Inventory Management 9(3), 1968.