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From EOQ to JIT with Storage Consideration: Coordinating a Two Level Supply Chain

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thesis
posted on 22.05.2021, 13:39 by Yohan Jeju John
Many organizations are faced with a decision to choose between two inventory systems namely JIT (Just in Time) and EOQ (Economic Order Quantity). This thesis models the cost drivers into the EOQ model and extends it to the JIT scenario. They include cost savings like space, synergy of coordination, and other cost factors like rework and penalty costs. It looks at the total cost of the supply chain with two players and calculates space in terms of storage spaces of equal capacity. Results showed that considering space in EOQ brought savings to the chain. It has brought down the order quantity closer to, and many times equal to JIT ordering quantities. Coordination in the chain has brought further savings. Moving to JIT (ordering daily supply of demand) from the point, where space is accounted and there is coordination between the two levels, did not require much reduction in ordering costs.

History

Language

eng

Degree

Master of Applied Science

Program

Mechanical and Industrial Engineering

Granting Institution

Ryerson University

LAC Thesis Type

Thesis

Thesis Advisor

M. Y. Jaber

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