This research was motivated by a case study of canned sweet corn kernel which was a new product and its demand was uncertain. There was a time constraint for raw material procurement and the finished goods incubation before delivery due to food safe. In addition, customers required that canned food shelf life before delivery had to be less than six months. Currently, the production schedule and inventory control were not based on the demand data but employee experiences. This caused inefficiency production and inventory management. Hence, the objective of this study was to propose the inventory policy to improve the efficiency of production and inventory management so as to reduce the total cost under a desired service level. We collected historical sales data and study demand pattern. We found that the demand was normally distributed. Then, we used the historical demand to determine the reorder point and maximum inventory based on continuous inventory policies with 97% customer service level. After comparing total cost and cycle service level, we found that the best inventory policy was (s, S) policy. We could reduce total cost by 33.7% within 100% service level. In addition, we could reduce the number of production runs from 90 times to 15 times. In the future, we will implement this policy by updating the input data and recalculating the reorder point and maximum inventory for more accuracy.
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