Systems And Methods For Multi-Echelon Inventory Planning With Lateral Transshipment

• US 20120054076A1
• Filed: 08/30/2010
• Published: 03/01/2012
• Est. Priority Date: 08/30/2010
• Status: Active Grant

• Current Assignee: SAS Institute Incorporated
• Original Assignee: SAS Institute Incorporated
• Inventors: Wu, Xinmin, Yi, Jinxin
• Granted Patent: US 8,515,835 B2
• Time in Patent Office: Days
• US Class Current: 705/28
• CPC Class Codes: G06Q 10/087 Inventory or stock management, e.g. order filling, procurement or balancing against orders

Abstract

In accordance with the teachings described herein, systems and methods are provided for optimizing inventory in a multi-echelon inventory distribution network having at least a first echelon and a second echelon. An example method may include the steps of: receiving information identifying an inventory pool that includes at least two inventory locations within the first or second echelons; determining inventory excesses or shortages at inventory locations within the inventory pool; determining an inventory transshipment plan for transferring inventory between two or more of the inventory locations in the inventory pool based at least in part on the inventory excesses or shortages; and determining an inventory replenishment plan for replenishing inventory at one or more inventory locations in the first echelon from one or more primary supply locations in the second echelon, the inventory replenishment plan being based at least in part on the inventory excesses or shortages and accounting for any inventory transfers identified in the inventory transshipment plan.

Claims

1. A computer-implemented method of optimizing inventory in a multi-echelon inventory distribution network having at least a first echelon and a second echelon, comprising:

receiving information identifying an inventory pool that includes at least two inventory locations within the first or second echelons;

determining inventory excesses or shortages at inventory locations within the inventory pool;

determining an inventory transshipment plan for transferring inventory between two or more of the inventory locations in the inventory pool based at least in part on the inventory excesses or shortages; and

determining an inventory replenishment plan for replenishing inventory at one or more inventory locations in the first echelon from one or more primary supply locations in the second echelon, the inventory replenishment plan being based at least in part on the inventory excesses or shortages and accounting for any inventory transfers identified in the inventory transshipment plan;

wherein the steps of the method are performed by software instructions stored in or more computer-readable mediums and executable by one or more processors.

2. The computer-implemented method of claim 1, wherein the one or more primary supply locations are not included in the inventory pool.

3. The computer-implemented method of claim 1, further comprising:

determining optimum inventories for inventory locations within the inventory pool;

wherein the inventory excesses or shortages are determined by comparing the optimum inventories with actual inventories at the inventory locations within the inventory pool.

4. The computer-implemented method of claim 3, wherein the optimum inventories are determined based at least in part on a demand forecast and estimated delivery delays for the inventory locations within the inventory pool.

5. The computer-implemented method of claim 1, further comprising:

generating a comprehensive inventory plan for one or more of the inventory locations in the inventory pool, the comprehensive inventory plan including information from both the inventory transshipment plan and the inventory replenishment plan.

6. The computer-implemented method of claim 3, further comprising:

estimating average service levels for inventory locations within the inventory pool;

wherein the determination of inventory excesses or shortages is further based on the estimated average service levels.

7. A computer-implemented method of optimizing inventory in a multi-echelon inventory distribution network, comprising:

determining optimum inventories for a plurality of inventory locations in a first echelon of the multi-echelon inventory distribution network based at least in part on a demand forecast;

determining inventory excesses or shortages at the plurality of inventory locations in the first echelon based at least in part on a comparison between the optimum inventories for the plurality of inventory locations in the first echelon with actual inventories for the plurality of inventory locations in the first echelon;

determining inventory transshipments between two or more inventory locations in the first echelon based at least in part on the inventory excesses or shortages at the plurality of inventory locations in the first echelon; and

determining inventory replenishments from one or more inventory locations in a second echelon of the multi-echelon inventory distribution network to the plurality of inventory locations in the first echelon, the inventory replenishments being based at least in part on the inventory excesses or shortages at the plurality of inventory locations in the first echelon accounting for the inventory transshipments between the two or more inventory locations in the first echelon;

wherein the steps of the method are performed by software instructions stored in one or more computer-readable mediums and executable by one or more processors.

8. The computer-implemented method of claim 7, further comprising:

estimating delivery delays for inventory replenishments between inventory locations in two or more echelons of the multi-echelon inventory distribution network;

wherein the optimum inventories for the plurality of inventory locations in the first echelon is further based on the estimated delivery delays.

9. The computer-implemented method of claim 7, further comprising:

generating an inventory plan for the multi-echelon inventory distribution network based at least in part on the inventory transshipments and inventory replenishments.

10. The computer-implemented method of claim 7, further comprising:

determining optimum inventories for a plurality of inventory locations in the second echelon of the multi-echelon inventory distribution network based at least in part on the inventory replenishments from the one or more inventory locations in the second echelon to the plurality of inventory locations in the first echelon;

determining inventory excesses or shortages at the plurality of inventory locations in the second echelon based at least in part on a comparison between the optimum inventories for the plurality of inventory locations in the second echelon with actual inventories for the plurality of inventory locations in the second echelon;

determining inventory transshipments between two or more inventory locations in the second echelon based at least in part on the inventory excesses or shortages at the plurality of inventory locations in the second echelon; and

determining inventory replenishments from one or more inventory locations in a third echelon of the multi-echelon inventory distribution network to the plurality of inventory locations in the second echelon, the inventory replenishments being based at least in part on the inventory excesses or shortages at the plurality of inventory locations in the second echelon accounting for the inventory transshipments between the two or more inventory locations in the second echelon.

11. The computer-implemented method of claim 10, further comprising:

generating an inventory plan for the multi-echelon inventory distribution network based at least in part on the inventory transshipments and inventory replenishments for both the first and second echelons.

12. The computer-implemented method of claim 7, wherein the inventory transshipments are between inventory locations that are included in a pre-determined inventory pool.

13. The computer-implemented method of claim 12, wherein the inventory pool includes two or more inventory locations in the first echelon and at least one inventory location in another echelon of the multi-echelon inventory distribution network.

14. The computer-implemented method of claim 7, further comprising:

estimating average service levels for the plurality of inventory locations in the first echelon;

wherein the determination of inventory excesses or shortages at the plurality of inventory locations in the first echelon is further based on the estimated average service levels.

15. A system for optimizing inventory in a multi-echelon inventory distribution network having at least a first echelon and a second echelon, comprising:

one or more processors;

one or more memory devices;

central inventory optimization software stored on the one or more memory devices and executable by the one or more processors, and when executed by the one or more processors being configured to;

receive information identifying an inventory pool that includes at least two inventory locations within the first or second echelons;

determine inventory excesses or shortages at inventory locations within the inventory pool;

determine an inventory transshipment plan for transferring inventory between two or more of the inventory locations in the inventory pool based at least in part on the inventory excesses or shortages; and

determine an inventory replenishment plan for replenishing inventory at one or more inventory locations in the first echelon from one or more primary supply locations in the second echelon, the inventory replenishment plan being based at least in part on the inventory excesses or shortages and accounting for any inventory transfers identified in the inventory transshipment plan.

16. The system of claim 15, wherein the one or more primary supply locations are not included in the inventory pool.

17. The system of claim 15, wherein the central inventory optimization software is further configured to:

determine optimum inventories for inventory locations within the inventory pool;

wherein the inventory excesses or shortages are determined by comparing the optimum inventories with actual inventories at the inventory locations within the inventory pool.

18. The system of claim 17, wherein the optimum inventories are determined based at least in part on a demand forecast and estimated delivery delays for the inventory locations within the inventory pool.

19. The system of claim 15, wherein the central inventory optimization software is further configured to generate a comprehensive inventory plan for one or more of the inventory locations in the inventory pool, the comprehensive inventory plan including information from both the inventory transshipment plan and the inventory replenishment plan.

20. The system of claim 17, wherein the central inventory optimization software is further configured to:

estimate average service levels for inventory locations within the inventory pool;

wherein the determination of inventory excesses or shortages is further based on the estimated average service levels.

21. The system of claim 15, further comprising:

performance simulator software stored on the one or more memory devices and executable by the one or more processors, and when executed by the one or more processors being configured to;

receive the inventory transshipment plan and inventory replenishment plan from the central inventory optimization software; and

generate a simulation that implements the inventory transshipment plan and inventory replenishment plan within a model of the multi-echelon inventory distribution network.

22. The system of claim 21, wherein the performance simulator software is further configured to generate a key performance indicator report based on the simulation.