multi-echelon-inventory

What problem does it solve?

This Skill addresses the complexity of managing inventory across multiple locations and stages in a supply chain, aiming to minimize holding costs while meeting service level targets.

Core Features & Use Cases

• Network Optimization: Calculates optimal inventory levels (base stocks, safety stocks) for serial and distribution (arborescent) network structures.
• Service Level Management: Allows setting target service levels and optimizing them within a holding cost budget.
• Risk Pooling Analysis: Quantifies the inventory reduction benefits of centralizing inventory.
• Use Case: A CPG company wants to reduce its overall inventory holding costs across its distribution centers and retail stores. This Skill can help determine the optimal stock levels at each location to achieve this while ensuring product availability.

Quick Start

Use the multi-echelon-inventory skill to calculate optimal base stock levels for a serial supply chain with 3 stages, lead times [10, 5, 2], holding costs [1.0, 2.0, 5.0], and a demand mean of 100 with a standard deviation of 20, targeting a 95% service level.