Optimization of Raw Material Inventory Control System in Khorramshahr Oil Extraction Company Based on ( r,Q ) Optimal Inventory Policy

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Rezaie, Mojtaba | 2011

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Type of Document: M.Sc. Thesis
Language: Farsi
Document No: 42629 (01)
University: Sharif University of Technology
Department: Industrial Engineering
Advisor(s): Hajji, Rasool
Abstract:
This thesis is related to applying survey of scientific inventory control methods in Khoramshahr Oil Extraction Company (KHOEC). KHOEC is the producer of edible oils in I.R of Iran and is a subset of E.T.K.A holding organization. The inventory costs of high consuming items are studied and optimized based on the optimal ordering policy (r, Q). First, the company raw materials are identified and classified based on ABC analysis method. For developing the new method of inventory control, the demand for each item is predicted, and the probability distribution of demand during the lead time is determined. Then according to this information and the desired service level of management, order point and economic order quantities for all items are obtained. The total cost of the proposed inventory system are compared with the total cost of the current inventory system of the company .Finally, it is shown that the application of the new policy reduces the total inventory cost significantly
Keywords:
Inventories ; Demand ; Safety Stock ; Lead Time ; Service Level ; Annual Costs

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