Fixed Reorder Cycle Inventory Model
By Thamali Nisansala
Capabilities of an organization in which poor performance can cause loss of business. Failure to meet customer expectations with delivery of the product is an order loser.
The planning, directing, monitoring, and controlling of the processes related to customer orders, manufacturing orders, and purchase orders. Regarding customer orders, order management includes order promising, order entry, order pick, pack and ship, billing, and reconciliation of the customer account. Regarding manufacturing orders, order management includes order release, routing, manufacture, monitoring, and receipt into stores or finished goods inventories. Regarding purchasing orders, order management includes order placement, monitoring, receiving, acceptance, and payment of supplier.
An order quantity modifier applied after the lot size has been calculated that increases the order quantity to a predetermined multiple.
The key variable in a logistics configuration; the point (in time) at which a product becomes earmarked for a particular customer. Downstream from this point, the system is driven by customer orders; upstream processes are driven by forecasts and plans. E.g: principle of postponement.
Selecting or "picking" the required quantity of specific products for movement to a packaging area (usually in response to one or more shipping orders) and documenting that the material was moved from one location to shipping. E.g: order selection, batch picking, discrete order picking, zone picking.
The commitment of a customer to buy a product and the subsequent administrative and data processing steps followed by the supplier.
A set inventory level where, if the total stock on hand plus on order falls to or below that point, action is taken to replenish the stock. The order point is normally calculated as forecasted usage during the replenishment lead time plus safety stock. E.g: reorder point, statistical order point, trigger...