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Inventory Model Design by Implementing New Parameters into the Deterministic Model Objective Function to Streamline Effectiveness Indicators of the Inventory Management

Author

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  • Mária Stopková

    (Department of Transport and Logistics, Faculty of Technology, Institute of Technology and Business in České Budějovice, 370 01 České Budějovice, Czech Republic)

  • Ondrej Stopka

    (Department of Transport and Logistics, Faculty of Technology, Institute of Technology and Business in České Budějovice, 370 01 České Budějovice, Czech Republic)

  • Vladimír Ľupták

    (Department of Transport and Logistics, Faculty of Technology, Institute of Technology and Business in České Budějovice, 370 01 České Budějovice, Czech Republic)

Abstract

The aim of this article is to modify the parameters and thus the objective function of the deterministic model of inventory theory so that other important aspects, which influence inventory management, can be taken into consideration. These aspects include the nature of inventory consumption, the share of inventories in sales, the capacity of means of transport and, above all, the reliability of suppliers. This goal is achieved by performing sophisticated and specific calculations for the individual parameters in the modified model. The modification of the objective function of the deterministic model has created a new multi-criteria model. The outcome of this model sought to optimize the supply process in a way that minimizes the risks associated with a lack of inventories while maintaining the economic effectiveness thereof. The model effectiveness is examined by comparing the application of the deterministic model and the proposed model with modified objective function. The results of applying these individual models have been produced based on calculations of indicators showing inventory management effectiveness—the speed of inventory turnover and the average number of inventories in storage.

Suggested Citation

  • Mária Stopková & Ondrej Stopka & Vladimír Ľupták, 2019. "Inventory Model Design by Implementing New Parameters into the Deterministic Model Objective Function to Streamline Effectiveness Indicators of the Inventory Management," Sustainability, MDPI, vol. 11(15), pages 1-15, August.
  • Handle: RePEc:gam:jsusta:v:11:y:2019:i:15:p:4175-:d:254143
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    References listed on IDEAS

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    3. Adrián Šperka & Martin Vojtek & Jaromír Široký & Juraj Čamaj, 2020. "Improvement of the Last Mile-Specific Issues in Railway Freight Transport," Sustainability, MDPI, Open Access Journal, vol. 12(23), pages 1-18, December.

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