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Optimising the ordering policy for overseas-transported products by quantitatively forecasting demand

Beermann, Bart (2021) Optimising the ordering policy for overseas-transported products by quantitatively forecasting demand.

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Abstract:Haco C.V. (Haco) is a Dutch furniture company, located in Netherlands and Spain. Haco imports its products from all over the world, including domestic transportations and overseas shipments, using containers. The problem that Haco is currently facing is in its international logistics strategy. This strategy creates a prosperous price position by reduced product costs and soaring profit margins but makes Haco carry the logistical risks and responsibilities themselves. Currently, no clear purchasing policy is set up to regulate the moment and amount of ordering. Purchases are partially based on a brief look at primitive data but mostly on intuition and experience. This absence of policy triggers unwanted volatilities in purchasing amounts, caused by reactive handling on the regularly occurring stockouts, which result in mal performance on the optimal cycle service level (as shown in Table 9). In turn, stockouts cause volatilities in the number of product sales per week ( Figure A.2), completely disorientating the warehouse and its personnel and indirectly in higher warehousing- and logistics costs; three of the five observed problems from the problem cluster. Following Heerkens (2012) method, the following core problem is found: ‘Not having a stable and predominantly forecast-driven purchasing policy for overseas-transported products’. To create a solution design for overcoming the core problem, the following research question is formulated: How can Haco reduce inventory costs and improve service levels by optimising the purchasing policy and inventory stability for overseas-transported products using demand forecasting?
Item Type:Essay (Bachelor)
Faculty:BMS: Behavioural, Management and Social Sciences
Subject:31 mathematics, 85 business administration, organizational science
Programme:Industrial Engineering and Management BSc (56994)
Link to this item:http://purl.utwente.nl/essays/86148
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