Developing Simulation Optimization Model to Minimize Total Inventory Cost under Uncertain Demand

Asih, Hayati Mukti Developing Simulation Optimization Model to Minimize Total Inventory Cost under Uncertain Demand. In: Proceedings of the Second Asia Pacific International Conference on Industrial Engineering and Operations Management Surakarta.

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Abstract

Inventory is one of the essential parts in a shop floor, especially in the chicken slaughter houses industry. The uncertain
customer demand affects the uncertain raw materials (live chicken). So, to prevent the opportunity loss in business,
the availability of live chicken is unavoidable. It affects the high inventory cost. In addition, the high risk of chicken
death makes the problem more complicated. Therefore, this research is proposed to minimize the total inventory cost
under demand uncertainty by optimizing the economic order quantity (EOQ). This study develops simulation
optimization by integrating the Monte Carlo simulation and the Genetic Algorithm. This model optimizes the value
of reorder point and reorder quantity in order to minimize the total inventory cost. Some experiments consider the
analytical solutions and heuristic by varying crossover, mutation, and population values to provide a global optimum.
The result shows the proposed solution reduces 38.95% from the existing total inventory cost.

Item Type:	Conference or Workshop Item (Paper)
Subjects:	A General Works > AC Collections. Series. Collected works
Divisi / Prodi:	Faculty of Industrial Technology (Fakultas Teknologi Industri) > S1-Industrial Engineering (S1-Teknik Industri)
Depositing User:	Ph.D. Hayati Mukti Asih
Date Deposited:	30 Mar 2023 02:17
Last Modified:	30 Mar 2023 03:32
URI:	http://eprints.uad.ac.id/id/eprint/41831

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