Production planning in the consumer packaged goods industry

Seeanner, Florian

doi:10.1007/978-3-658-02089-7_2

Cited by 1 publication

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“…It comprises the sum of setup time, waiting time and transportation time which can be long and stochastic and affect the inventory level. The lead time differs from supplier to supplier due to their geographical locations and the transportation modes used to deliver orders (Seeanner, 2013) and is usually more prolonged due to particular reasons; e.g., delays in processing orders, arranging payment, consolidation houses and delay at cross-docks or ports. These delays can result in inefficient inventory planning which can later cause the possibility of shortage or excess on-hand inventory levels (Duffie, Bendul, & Knollmann, 2017).…”

Section: Introductionmentioning

confidence: 99%

A Discrete Event Simulation Analysis of the Bullwhip Effect in a Multi-Product and Multi-Echelon Supply Chain of Fast Moving Consumer Goods

Ali

Khalid

Qaiser

2020

Pak.j.stat.oper.res.

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Timely delivery is the major issue in Fast Moving Consumer Good (FMCG) since it depends on the lead time which is stochastic and long due to several reasons; e.g., delay in processing orders and transportation. Stochastic lead time can cause inventory inaccuracy where echelons have to keep high product stocks. Such performance inefficiency reflects the existence of the bullwhip effect (BWE), which is a common challenge in supply chain networks. Thus, this paper studies the impact of stochastic lead time on the BWE in a multi-product and multi-echelon supply chain of FMCG industries under two information-sharing strategies; i.e., decentralized and centralized. The impact was measured using a discrete event simulation approach, where a simulation model of a four-tier supply chain whose echelons adopt the same lead time distribution and continuous review inventory policy was developed and simulated. Different lead time cases under the information-sharing strategies were experimented and the BWE was measured using the standard deviation of demand ratios between echelons. The results show that the BWE cannot be eliminated but can be reduced under centralized information sharing. All the research analyses help the practitioners in FMCG industries get insight into the impact of sharing demand information on the performance of a supply chain when lead time is stochastic.

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Section: Introductionmentioning

confidence: 99%