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Managing seasonal dry inventory at PT. De Lions

Prasetya, Radix and Hasanbasri, Mursyid (2010) Managing seasonal dry inventory at PT. De Lions. In: 2nd International Conference on Technology and Operations Management (ICTOM), 5 - 7 July 2010 , Bayview Hotel, Langkawi. (Unpublished)

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PT. De Lions is a joint venture company between recognized group from local company and a multinational company which has long experience in modern retail business. Almost every year De Lions encounter highest demand problem during seasonal period. To overcome the problem, De Lions currently applied conventional method by assuming annual sales growth as a factor to plan and to set inventory during seasonal period. This paper presents a new method and strategy to solve the problem. Due to special characteristic of demand and selling period, News Vendor model is applied to obtain the number of optimal order to maximize profit. In addition, Crossdock Strategy is also proposed to reduce number of non-seasonal products inventories. The results show that implementation of News Vendor model at De Lions can gain estimated profit about Rp. 171,134,720 or increasing 5.45% compared to that with conventional method. Additional benefit from implementation of Crossdock strategy would reduce warehouse rent expense about Rp. 510,000,000. Hence, estimated total benefit from both methods would be Rp. 681,134,720 or increasing up to 21.70% compared that with conventional method. The result is very significant if it is compared with PT. De Lions average monthly margin from sales in 2008 which was only 13.52%.

Item Type: Conference or Workshop Item (Paper)
Additional Information: Organized by UUM College of Business, Universiti Utara Malaysia
Uncontrolled Keywords: Seasonal demand; Newsvendor; Crossdock Strategy
Subjects: T Technology > TS Manufactures
Divisions: School of Technology Management & Logistics
Depositing User: Mrs. Norazmilah Yaakub
Date Deposited: 26 Dec 2011 01:12
Last Modified: 26 Apr 2016 00:38
URI: http://repo.uum.edu.my/id/eprint/4048

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