Determining inventory service support levels in multi-national companies

G. Don Taylor, Doug M. Love, Miles W. Weaver, James Stone

Research output: Contribution to journalArticlepeer-review

Abstract

Multi-national manufacturing companies are often faced with very difficult decisions regarding where and how to cost effectively manufacture products in a global setting. Clearly, they must utilize efficient and responsive manufacturing strategies to reach low cost solutions, but they must also consider the impact of manufacturing and transportation solutions upon their ability to support sales. One important sales consideration is determining how much work in process, in-transit stock, and finished goods to have on hand to support sales at a desired service level. This paper addresses this important consideration through a comprehensive scenario-based simulation approach, including sensitivity analysis on key study parameters. Results indicate that the inventory needs vary considerably for different manufacturing and delivery methods in ways that may not be obvious when using common evaluative tools.
Original languageEnglish
Pages (from-to)1-11
Number of pages11
JournalInternational Journal of Production Economics
Volume116
Issue number1
DOIs
Publication statusPublished - Nov 2008

Keywords

  • service level
  • product sourcing
  • global manufacturing

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