Comparison of Inventory Models for Optimal Working Capital; Case of Aeronautics Company

Abstract

The goal of supply chain management is to provide products with best quality, low costs and shortest delay of delivery corresponding to customers' expectations. To ensure that, companies must be in continuous research for management methodologies which allows them the possibility to improve their financial results by decreasing costs and improving their process and thus customers satisfaction. Before searching for a metaheuristic function of the optimal solutions, this paper is presenting a basic research, conducted in aeronautic company to find out the better solution for raw material inventory management. These raw materials are obtained from the supply of imports and some local purchases. The aims of study are to present a comparison of inventory deterministic models, the economic order quantity, the Interval order quantity and the minimum maximum inventory. The first step is to collect data's containing 3896-part number with various suppliers, lead time, costs, consumption, holding cost and set up cost, the second step is calculating the order quantity with deterministic models and analyzing the results to choose the better solution. The third step is doing the ABC classification and comparing the amount of average stock between the three methods. The results show that the optimal deterministic solution is a combination of two of them.