Study On Ordering Strategy And Its Simulation Evaluation For HT Company

HT is a leading company in the field of industry connectors, a diversified business foundation has been built not only in technology, applicable markets and product categories but also formed strong transnational industrial chain globally which brings up rapid sales growth all over the world. However, supply chain management was a big bottleneck compare to the rapid expansion of business. The negative impaction from single forecast oriented stock strategy was reflected obviously with business growth. This causes not only a big burden for enterprise but supply shortage was still not improved. In addition, profit margin was not increasing in parallel to the sales growth. Thus, it is extremely urgent for HT to build up a new stock control strategy based on existed ordering process as well as to support further business growth.This thesis aims at the ordering control of typical X material by using the statistical method to analysis the sales history of X material in latest three years and also apply the conception of product life cycle to approach the conclusion that X material is in the life phase of ramp up. To form up material ordering strategy, the thesis compare the options among classic ordering strategy, ordering based on demand growth rate and ordering based on forecast to approach the way to form ordering qty. Then using discrete event modeling and simulation technology to establish an inventory simulation model with a combination goal of stock carrying cost, ordering cost, shortage cost to evaluate which strategy is best. The effective strategy was proved to be the option based on forecast for X material with ramp up and unstable volume. Furthermore, reliability analysis was also implemented to assess the confidential level and interval for the simulation result to enhance the reliability of the evaluation data. The research provides a tool and method for HT company to form and evaluate the material ordering strategy.