Setting the Order-Up-to Level in a Retailer: challenges and Empirical Comparison of Simple Methods

Vicent Asensio-Molina ^[1] ; Angel Ruiz ^[2] ; Garcia-Sabater, Jose P. ^[1] ; Garcia-Sabater, Julio J. ^[1]
1. [1] Universidad Politécnica de Valencia
  
  Universidad Politécnica de Valencia
  
  Valencia, España
2. [2] Laval University
  
  Laval University
  
  Canadá
Localización: Advances in engineering networks: proceedings of the 12th International Conference on Industrial Engineering and Industrial Management / Rodolfo de Castro Vila (ed. lit.), Gerusa Giménez Leal (ed. lit.), 2020, ISBN 978-3-030-44530-0, págs. 217-224
Idioma: inglés
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Resumen
- Order-up-to level is one of themost popular inventory management strategies in the retail industry. However, there exist several manners to fix the up-to-level. In this paper, we consider several of these manners and analyze their application to a real retail company. The company requires a method which is simple to understand and adopt and that should seek to minimize stockouts and in-store stock levels. We empirically compare, using real data, severalmethods to set the order-up-to value and report the performance of the system for each of them. Our results also demonstrate the relevance of two important factors, which are the size of the packaging and the seasonality of demand.