Inventory Inaccuracy and Supply Chain Performance: A Simulation Study of a Retail Supply Chain

Item Type Journal paper

Inventory inaccuracy is a main issue in businesses dealing with physical assets. The aim of this paper is to examine the relationship between inventory inaccuracy and performance in a retail supply chain. We simulate a three echelon supply chain with one product in which end-customer demand is exchanged between the echelons. In the base model, without alignment of physical inventory and information system inventory, inventory information becomes inaccurate due to low process quality, theft, and items becoming unsaleable. In a modified model, these factors that cause inventory inaccuracy are still present, but physical inventory and information system inventory are aligned at the end of each period. The results indicate that an elimination of inventory inaccuracy can reduce supply chain costs as well as the out-of-stock level. Automatic identification technology that is becoming available offers the potential to achieve inventory accuracy.

Authors Fleisch, Elgar & Tellkamp, Christian
Journal or Publication Title International Journal of Production Economics
Language German
Keywords Inventory inaccuracy; Retailing; Automatic identification; Simulation; Supply chain performance
Subjects other research area
HSG Classification not classified
Refereed No
Date 18 March 2005
Publisher Elsevier
Place of Publication New York
Volume 95
Number 3
Page Range 373-385
Number of Pages 13
ISSN 0925-5273
ISSN-Digital 1873-7579
Publisher DOI 10.1016/j.ijpe.2004.02.003
Depositing User Prof. Dr. Elgar Fleisch
Date Deposited 14 Dec 2005 20:29
Last Modified 23 Aug 2016 10:59


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Fleisch, Elgar & Tellkamp, Christian (2005) Inventory Inaccuracy and Supply Chain Performance: A Simulation Study of a Retail Supply Chain. International Journal of Production Economics, 95 (3). 373-385. ISSN 0925-5273

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