Inventory models

The basis for each planning concept is an inventory model. Lanza has three inventory models: fast, slow, non.

Fast

For fast movers, Lanza uses a R,s,Q-inventory model, calculating the reorder point and order quantity. Inventory is reviewed every period (R). When the inventory drops below the reorder point (s), a replenishment is triggered for replenish the inventory with the order quantity (Q).

  • Applicable for fast moving parts
  • Uses R, s, Q-model
  • Assumes normal distribution of demand
  • Default model for: ‘Wholesale’, ‘Lean’, ‘Proactive’

 

Slow

For slow movers, Lanza uses a S-1, S-model, calculating a basestock level. When inventory drops below the basestock level (S), a replenishment is triggered to replenish the inventory back to the basestock level.

  • Applicable for slow moving parts
  • Uses S-1, S-model
  • Assumes (compound) Poisson distribution of demand
  • Default model for: ‘Just in case’

 

Non

For non-movers, Lanza uses no inventory model, as there is no demand.

  • Applicable for non-moving parts
  • Default model for: ‘Non stock’