Stock keeping unit fill rate specification

Teunter, R.H., Syntetos, A. A. ORCID: https://orcid.org/0000-0003-4639-0756 and Babai, M.Z. 2017. Stock keeping unit fill rate specification. European Journal of Operational Research 259 (3) , pp. 917-925. 10.1016/j.ejor.2016.11.017

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Abstract

The fill rate is the most widely applied service level measure in industry and yet there is minimal advice available on how it should be differentiated on an individual Stock Keeping Unit (SKU) basis given that there is an overall system target service level. The typical approach utilized in practice, and suggested in academic textbooks, is to set the individual service levels equal to the targeted performance required across an entire stock base or a certain class of SKUs (e.g., in ABC classification). In this paper it is argued that this approach is far from optimal and a simple methodology is proposed that is shown (on real life datasets) to be associated with reductions in stock investments. In addition, the new approach is intuitive, very easy to implement and thus highly likely to be positively received by practitioners and software manufacturers

Item Type:	Article
Date Type:	Publication
Status:	Published
Schools:	Business (Including Economics)
Uncontrolled Keywords:	Inventory; Service Level; Fill Rate; Safety Stock
Publisher:	Elsevier
ISSN:	0377-2217
Date of First Compliant Deposit:	17 November 2016
Date of Acceptance:	6 November 2016
Last Modified:	22 Nov 2024 09:30
URI:	https://orca.cardiff.ac.uk/id/eprint/96198

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