A Model for Evaluating Vendor Bids for Stock Replenishment of an Item.
Abstract
The Ships Parts Control Center (SPCC) Uniform Inventory Control Program (UICP) wholesale replenishment model for 1H cognizance symbol (consumable) material is an order quantity-reorder level or (Q,r) model. A stocked item's order quantity and reorder level are established in large part by the unit price and procurement lead time forecasted for it. When a replenishment is needed, the order quantity is specified and the procurement lead time forecasted for it. When a replenishment is needed, the order quantity is specified and the procurement officer requests bids from vendors. These bids include both a unit price and an estimate of production lead time. The thesis examines the impact of differences between the forecasted and actual values for lead time and price on the optimum total annual cost of stocking the item as computed by the UICP model. A modification of the model for comparison of the total annual cost associated with the lead time and price combination of each vendor bid is developed. Some expected effects of implementing the model are discussed and areas requiring further research are identified. Keywords include: Inventory Model; Uniform Inventory Control Program; Price break models; Procurement.
Document Details
- Document Type
- Technical Report
- Publication Date
- Dec 01, 1984
- Accession Number
- ADA154069
Entities
People
- R. D. Gray
Organizations
- Naval Postgraduate School