Inventory control in environments with seasonal demand

摘要

In the traditional reorder point model no consideration is taken to variations in demand. The purpose of this paper is to present an extended reorder point model based on an assumption of stationary demand suitable for ERP systems and capable of taking such considerations. The purpose is also to assess potential benefits of using the model by means of simulation and to provide some rough heuristic guidelines for the practitioner regarding when to use this model rather than the traditional one. The result from the assessment indicates that even in cases with a low degree of seasonality it is of significant importance to consider seasonal variations when calculating the demand during the lead time part of the reorder point to be able to achieve targeted service levels. Considering seasonal demand when calculating safety stocks and order quantities is basically only of significant importance in cases when the degree of seasonality is high.