Research Of Inventory Optimization In Company X

With increasing competition from global market, the pressure of survival is intensified for most companies. Stick to the core competition, improving overall production efficiency, cutting down production cost, increasing inventory turn over times while decreasing inventory level, maintaining customer satisfaction are keys to maintain a sustainable, profitable growth.Guiding by theory of modern supply chain management, this paper studied the overall inventory performance of company X, outlined different solutions to optimize inventory of raw material, WIP.This first chapter studies the background and the development of supply chain management. The second chapter analyzes different approaching on inventory optimization including VMI, Lot Size Optimization and Multi-level inventory management. The third chapter focus on analysis of existing inventory management system and trouble shooting of company X. The forth chapter studies the impacts from procurement behavior and the 5th chapter introduces the methodologies of realizing the inventory optimization in company X.1) Lot size optimization and localization is the most effective way to reduce inventory from oversea suppliers2) VMI play an important role on reducing inventory from local suppliers.3) Kanban is a powerful tool to control semi-finished product inventory.Finally, the last chapter summarizes this paper.