Establish a policy for ordering multiple consumable products simultaneously

Abstract

Defining or planning product purchasing policies is very important because setting an appropriate purchasing policy can reduce the company's overall costs. which determines the product ordering policy who will plan or set the policy must know the details of the product and conditions for ordering products with the originating company or manufacturer Including all expenses that must occur in ordering products into the company and must know each product customer behavior to be used to predict future customer orders. This research aims to analyze and establish a policy for purchasing new supplies to be suitable for needs and have the lowest average annual total cost. However, an unstable demand for consumables or Liner bags has zero demand for many periods (Intermittent Demand and Lumpy Demand) cause it difficult for the company to manage inventory and reserve products to prevent product shortages. Therefore, it sets up a policy for ordering new supplies by forecasting demand that may occur in the future. In this research, 4 forecasting methods will be used 1. Forecasting by Croston's method 2. Forecasting by Syntetos and Boylan (SBA) estimation method 3. Forecasting by Shale Boylan and Johnston method (SBJ) 4. Forecasting by the method of Teunter Syntetos and Babai (TSB) and using the mean and standard deviation obtained from the forecasting method with the square root of the mean square error (RMSE) that lowest RMSE is used to calculate the order quantity, reorder point and safety stock to prevent shortages of each item that keeps the total annual cost to a minimum. By using the method of ordering many products at once (Joint Replenishment Problem) under the limitations of a container that can hold only 12 pallets and the ordering requirements that must order a full pallet per item.