Inventory Control Policy by Using the Blanket Purchase Orders
Type Of :
Academic Manuscript
Type :
Industrial Engineering
The purpose of this research is to implement the blanket purchase orders for spare parts inventory
management. In this case, there are problems related with inventory control that are spare parts shortages, low
inventory turnover ratio, increased inventory value or outdated spare parts. Starting with ABC analysis, the selected
items are top 20 % of total purchasing orders. Accordingly, Analytic Hierarchy Process (AHP) was applied to select
the blanket order items. In the AHP approach, there are three criteria decision making that are purchase price
variance, delivery frequency, and purchase frequency. Two forecasting techniques, exponential smoothing and
seasonal forecasting, were compared. In the final analysis, implementing the blanket purchase orders can reduce
total costs of spare parts inventory management approximately 81.6%.
Date01/07/2019
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