Optimizing the inventory control policy within an electronics production company

This research is conducted at Hortec Electronics. Hortec Electronics is located in Oldenzaal and is specialized in the development and production of printed circuit boards. The focus of this research is on reducing the inventory values(i.e., the monetary value of the inventories in the warehouse). The current total inventory value is 30% of the revenue. The management of Hortec considers this too high. The inventory value per item is calculated by multiplying the inventory level with the item price. The total inventory value is a summation of the inventory values over all items. Reducing the inventory value leads to less capital utilization and higher liquidity. The current purchasing strategy is solely based on experience, instead of using decision rules. A clear decision-making process for the purchasing strategy is desired so that no experience is needed and the inventory values can be reduced.