A multiple-purpose simulation-based inventory optimization system: Applied to a large detergent company in China

Abstract

In this paper, we introduce a practical simulation system to analyze a real inventory system of a top 3 detergent manufacturer in China. The simulation system has been actively executed to support weekly inventory policy decision making since online. We detail how we simulate the client's finished product inventory at its manufacturing sites and warehouses. We concentrate on describing its structure, as well as its applications. We also demonstrate how to apply this simulation system to obtain an optimized policy to manage the stock keeping unit (SKU) level inventory through numeric experiments.