Research On Safety Stock Under Environment Of Uncertain Demand In D Company

Safety stock theory research was started in the 1960 s,and the theory was gradually accepted by Chinese companies several decade years.Holding safety stock becomes popular in China’s enterprises,especially in manufacturing flexible supply systems.With the diversification and customization of consumer demand,it is increasingly difficult to accurately estimate forecast and demand.Therefore,more and more companies keep seeking more flexible supply chain in response to market differentiation.One specific solution is to hammer away at inventory management strategy optimization continuously and develop safety stock implementation method accordingly to their own industry and product characteristics.As an original equipment manufacturer that undertakes project-type needs,D Company is also facing a volatile market environment.The demand of D company has typical project feature of low volume high mix,fluctuation hugely,short lead time supply,which requires high flexibility of D company.Most enterprises in this field execute higher inventory policy to meet rapidly changing demand,and to reduce impact on supply chain endlessly because of uncertainty.But,the fact mostly is holding higher inventories is limited on enhancing customer services.D company faces such disadvantage situation: although the company’s inventory keep high level and increase year by year,on-time-delivery keep a low level always.This article puts forward safety stock design route,objectives and principles of implementation.According to the current situation of D company inventory,this paper analyzes the problem of D company inventory management based on the related theories of supply chain and inventory management,and proposes of safety stock design ideas from the aspects of demand uncertainty and product and production characteristics.This article gives measurement method about forecast accuracy percentage,certain product demand redistribution logic in product family,and weight ways of various factors such as of product life cycle and historical shortage status based on data analysis of products features,future demand and supply capability etc.,then generates safety stock model calculation method for D company.This article provides the estimation ways and results of customer service improvement,capital and storage occupation after safety stock implementation in D company and introduces corresponding information system status.Finally,this article introduces the procedures of each related parameters setting,process promoting approaches and risk controlling methods.Ensuring the safety stock methods executesuccessfully to reduce the impacts from uncertainty,and enhance customer service level for D company.