Study On Finished Goods Inventory Improvement To Achieve Order Fulfillment

As the development of increasingly changes, market competition has derived from product quality to customer service level. It is necessary for company to increase working efficiency in supply chain besides improving product quality. It contains production, purchase, delivery, warehouse, packing and distribution. Each step is related to inventory control. If inventory is too high, it will occupy too much capital. If inventory is too low, it will impact company image and lose sales opportunity. Therefore, inventory control can help company to get advantages in the market.Based on inventory management theory and company business, the thesis will provide some strategy to improve operation process.(1) There is no standard operation process on demand forecast and it is difficult to keep forecast accurate. Seasonal index method can be used to predict demand trend since history demand changes by season.(2) In order to efficiently manage inventory, products will be classified as Make to Stock and Make to Order. ABC analysis and safety stock will be applied to stock units.(3) Finished goods will be classified as MTS(Make-To-Stock) and MTO(Make-To-Order). Fixed-quantity order will be used to manage Class A items under MTS. Economic Order Quantity approach can help to balance ordering cost and storage cost to minimize total cost. Fixed-interval order will be used to Class B and C items to save processing time and cost.The expectation of the study is to improve inventory turnover from 2.17 to 4.14 and reduce Months of Supply from 5.5 to 2.9, meanwhile, customer service level can be kept above 95%. Then it can facilitate order fulfillment and enhance competition advantages.