Title: Conditions for executing a q-fulfillment process from the warehouse of a retailer of consumables - Based on a case study at Staples. Context: Changing customer expectations, increasing GDP per capita and urbanization drives the development of quicker e-fulfillment. Research shows that customers are more likely to complete their purchase and buy more often if the retailer has fast delivery options, like same-day delivery. No literature was found describing how warehouse activities of e-commerce retailers should be adjusted to be able to deliver to the customer within an hour.  Purpose: The study aims to fill the identified research gap by establishing conditions for a retailer of consumables to execute a q-fulfillment process from a warehouse. Economic consequences of the established conditions are also aimed to be clarified. Lastly the study explores under which conditions the case company, Staples, can execute a q-fulfillment process in their automated warehouse. Questions at issue:  Under which conditions can an e-commerce retailer of consumables execute a q-fulfillment process in a warehouse?How are a retailer’s costs affected by applying the established conditions for executing a q-fulfillment process?Under which conditions can Staples execute a q-fulfillment process in their automated warehouse?Methodology: The study took an objective ontological approach, and epistemological and axiological assumptions were made. The research philosophy was positivistic, and a deductive approach was taken. The methodological choice was qualitative, and a case study was made together with the case company, Staples. All of these methodological choices esteemed by the authors as best suited for this explorative research. The sample selection was a mixture between a purposive and a convenience sampling, since it fitted the study, and the case company was located close to the authors. The theoretical chapters contain document secondary data, while the empirical chapters contain primary data in terms of one-to-one interviews. The data analysis consists of a circular flowchart and pattern matching to analyze the gathered data. The study achieved reliability since it was not affected by random deviations, and replicability because it was sufficiently detailed. It is valid since it was generalizable and the expected casual relationships among the variables were true. Ethical considerations were kept in mind throughout the entire study and the authors collaborated well.  Results: The authors found 20 conditions for a retailer of consumables to fulfill to be able to execute a q-fulfillment process, and 21 conditions for Staples to fulfill. Many similarities were found between the two research questions and only one condition differed. The authors also found that some of the conditions drive more costs than others and that the retailer by themselves has to decide which conditions are applicable to their individual process.  Keywords: E-commerce, Q-commerce, Quick-commerce, Quick order fulfillment, Q-fulfillment & Inventory management.

Este documento presenta una Propuesta de Sistema de Gestión de Inventarios basado en la metodología DPOK, utilizada por Toyota en las operaciones de sus concesionarios, para la reducción y control del Stock sin Movimiento, problema identificado en un concesionario de autos ubicado en la ciudad de Tarapoto, Perú. Se realiza un análisis de causas que identifica a la reposición empírica y falta de control como causa principal y se plantea tomar acción en cuatro campos: Planeamiento de Inventarios, Almacenamiento, Gestión de Pedidos Especiales y Medición y Seguimiento de los procesos, abarcando de esta forma los diferentes factores que influyen en el problema identificado. Para cada campo de acción se plantea un procedimiento, se fijan metas, se establecen indicadores clave y puntos de evaluación, tomando como guía la metodología DPOK y los estándares de la marca Toyota. Luego de nueves meses de implementado el sistema se observan resultados preliminares positivos en los indicadores de Stock sin Movimiento y Meses de Stock. / This document presents a Proposal for an Inventory Management System based on the DPOK methodology, used by Toyota in the operations of its dealerships, for the reduction and control of Stock without Movement, a problem identified in a car dealership located in the city of Tarapoto, Peru. An analysis of causes is carried out that identifies the empirical restocking and lack of control as the main cause and considers acting in four fields: Inventory Planning, Storage, Management of Special Orders and Measurement and Monitoring of processes, encompassing the different factors that influence the identified problem. For each field of action, a procedure is proposed, goals are set, key indicators and evaluation points are established, taking the DPOK methodology and the Toyota brand standards as a guide. After nine months having the system implemented, positive preliminary results are observed in the Stock without Movement and Stock Months indicators. / Trabajo de investigación

Denna skriftiga avhandling omfattar en redogörelse kring examensarbetet dimensionering av färdigvarulager. Arbetet har genomförts på Scania DT i Södertälje inom avdelningen för transmission och axlar. Den centrala delen i arbetet har varit att studera hur dagens färdigvarulager för transmission skall kunna möta framtidens produktionsrelaterade utmaningar. I samband med att högre produktionsvolymer var prognostiserade inom den ärmaste åren samt att ett helt nytt artikelprogram parallellt skulle införas i sortimentet så talade sammantaget för att dagens kapacitet skulle överskridas. För att säkra färdigvarulagrets kapacitet inför de framtida omställningarna skulle området granskas för att sedan presentera lösningsförslag på en rad punkter i syfte att ge lagret ökad kapacitet. Primärt inriktades fokus på att se över lagrets dimensionering, och genom byggnation av simuleringsmodeller kunna presentera förslag på nödvändiga dimensionersom skulle kunna hantera de ökade produktionsvolymerna. Scania efterfrågade även att simuleringsmodellerna skulle kunna appliceras på deras övriga system för färdigvarulager och då kunna presentera liknande dimensionsförslag inför framtida scenarion. Arbetet avgränsades till att se över tre tidshorisonter som hade avgörande betydelse för lagrets kapacitet. Horisonterna omfattade att överskåda dagens volymer samt två framtida steg av produktionsökning och reducering av systemets takttider vilket skulle generera större volymflöden av produkter. Genom lösningsmetoderna semistrukturerade intervjuer, byggnation av simuleringsmodeller, observationer och datakällor samlades fakta in för modellbyggnaden.  Modellens första steg var att motsvara dagens färdigvarulager, i syfte att validera resultaten från modellen emot bekräftad data. Sedan skulle framtida produktionsdata genereras utifrån dagens in- och utflöden för att motsvara framtidens produktionsökningar. Framtidens produktionsdata genererades genom att reducera dagens ut- och in leveransdata med differenserna mellan de nya och gamla takttiderna. Dataverktyget Excel tillämpades för hantering av de stora datamängderna, medan simuleringsprogrammet Extendsim9 användes för modellbyggnaden. Programmen kopplades sedan samman och genererade framtidens volymflöden som lagret sedan skulle dimensioneras efter. Dessa resultat skulle även ligga till grund för vidare formulering av lösningsförslag kring hur aspekterna arbetsmetodik och lagerlayout kunnat omarbetas för att öka lagrets hanteringsförmåga. Dessa två aspekter granskades utöver dimensioneringsförslagen eftersom det ända lösningsförslaget som var tillämpningsbara utifrån aspekten dimensionering var utbyggnation i höjd eller bredd för att ge rum för fler ställage. Detta lösningsförslag var mycket kostsamt och inte ett förstahandsval för Scania, vilket efterfrågade andra lösningsmetoder på problemet. Efter att simuleringarna hade genomförts så granskades resultaten från modellens olika komponenter. Resultaten indikerade att nästa produktionsomställning skulle medföra ett produktflöde som överskrider dagens lagringskapacitet. Dessutom skulle truckarnas kapacitet i färdigvarulagret överbeläggas i samband med reducerad takttid, vilket skulle innebära regelbundna produktionstopp då transportbanorna överbeläggs med artiklar. Lösningsförslag presenterades i syfte att säkerställa färdigvarulagrets framtida kapacitet, där förslagen riktades emot de flaskhalsar som hade identifierats parallellt med omställningarna. Förslagen omfattade implementering av höglager, tillförd truck- och transport kapacitet, reducerad liggtid för lagrets artiklar och omarbetad slottid för att möjliggöra ett tillräckligt brett utflöde inför de nya volymerna. Sammantaget resulterar i en kapacitetsökning för dagens färdigvarulager, så att det kan möta framtidens kapacitetskrav. / This written summary includes an account of the thesis project “dimensioning of finished goods inventory”. The work has been carried out at Scania DT in Södertälje within the department for transmission and axles. The central part of the work has been to study how today's finished goods inventory for transmission should be able to face the future production-related challenges. In conjunction with the fact that higher production volumes were forecasted for the next few years and that a completely new article program would be introduced in parallel with today’s assortment concludes that the overall current capacity would be exceeded. In order to secure the capacity of the finished goods inventory before the future changes, the area would be reviewed so that solutions could be proposed on a number of points in order to increase the capacity of the finished goods inventory. Primarily the focus was on reviewing the dimensions of the inventory and building simulation models to be able to present proposals for necessary dimensions that could handle the increased production volumes. Scania also requested that the simulation models could be applied to their other finished goods inventories so the model could be used to present similar dimensional proposals for future scenarios in other inventories. The work was limited to look at three time horizons that were of crucial importance for the inventories capacity. The horizons included the current volumes of today as well as two future stages of increase in production with a reduction of the system's cycle times, which would generate larger volume flows of products. Data for the simulation models were collected with the solution methods, semistructured interviews, construction of simulation models, observations and data sources. The model's first step was to mirror to today's finished goods inventory, in order to validate the model against confirmed data. Then future production data would be generated based on the current input and output flows to correspond to future production increases. The production data of the future was generated by reducing today's output and input data with the differences between the new and old cycle times. The Excel data tool was used to manage the large amounts of data, while the simulation program Extendsim9 was used for the construction of the model. The data in the programs were then linked together and generated the future volume flows that the inventory would be dimensioned for. These results would be the basis for the solutions that would be proposed on how the aspects of working methodology and inventory layout could be reworked to increase the storage capacity of the inventory. These two aspects were examined in addition to the proposals for dimensioning, since the only solution proposal that was applicable on the aspect of dimensioning was expansion in height or width to give room for more stalls. This solution was very costly and not a first choice for Scania, which requested other solution methods to the problem. After the simulations were completed, the results of the various components of the model were examined. The results indicated that the next production increase would result in a product flow that exceeds today's storage capacity. In addition the capacity of the trucks in the finished goods inventory would be overloaded in conjunction with reduced cycle time, which would mean regular production stoppages when the conveyor belts were overloaded with articles. Solution proposals were presented in order to ensure the future capacity of the finished goods inventory, where the solutions were aimed against the bottlenecks that had been identified in parallel with the changes. The proposals included the implementation of high bay warehouse, added truck and transport capacity, reduced lay time for the inventory´sarticles and revised time slots to enable a sufficiently wide outflow for the new volumes. This results in an overall increase in capacity for todays finished goods inventory, so that it can meet the future capacity requirements.

In many equipment-intensive organizations in the manufacturing, service and particularly the defense sectors, service parts inventories constitute a significant source of tactical and operational costs and consume a significant portion of capital investment. For instance, the Defense Logistics Agency manages about 4 million consumable service parts and provides about 93% of all consumable service parts used by the military services. These items required about US$1.9 billion over the fiscal years 1999-2002. During the same time, the US General Accountability Office discovered that, in the United States Navy, there were about 3.7 billion ship and submarine parts that were not needed. The Federal Aviation Administration says that 26 million aircraft parts are changed each year. In 2002, the holding cost of service parts for the aviation industry was estimated to be US$50 billion. The US Army Institute of Land Warfare reports that, at the beginning of the 2003 fiscal year, prior to Operation Iraqi Freedom the aviation service parts alone was in excess of US$1 billion. This situation makes the management of these items a very critical tactical and strategic issue that is worthy of further study. The key challenge is to maintain high equipment availability with low service cost (e.g., holding, warehousing, transportation, technicians, overhead, etc.). For instance, despite reporting US$10.5 billion in appropriations spent on purchasing service parts in 2000, the United States Air Force (USAF) continues to report shortages of service parts. The USAF estimates that, if the investment on service parts decreases to about US$5.3 billion, weapons systems availability would range from 73 to 100 percent. Thus, better management of service parts inventories should create opportunities for cost savings caused by the efficient management of these inventories. Unfortunately, service parts belong to a class of inventory that continually makes them difficult to manage. Moreover, it can be said that the general function of service parts inventories is to support maintenance actions; therefore, service parts inventory policies are highly related to the resident maintenance policies. However, the interrelationship between service parts inventory management and maintenance policies is often overlooked, both in practice and in the academic literature, when it comes to optimizing maintenance and service parts inventory policies. Hence, there exists a great divide between maintenance and service parts inventory theory and practice. This research investigation specifically considers the aspect of joint maintenance and service part inventory optimization. We decompose the joint maintenance and service part inventory optimization problem into the supplier s problem and the customer s problem. Long-run expected cost functions for each problem that include the most common maintenance cost parameters and service parts inventory cost parameters are presented. Computational experiments are conducted for a single-supplier two-echelon service parts supply chain configuration varying the number of customers in the network. Lateral transshipments (LTs) of service parts between customers are not allowed. For this configuration, we optimize the cost functions using a traditional, or decoupled, approach, where each supply chain entity optimizes its cost individually, and a joint approach, where the cost objectives of both the supplier and customers are optimized simultaneously. We show that the multiple objective optimization approach outperforms the traditional decoupled optimization approach by generating lower system-wide supply chain network costs. The model formulations are extended by relaxing the assumption of no LTs between customers in the supply chain network. Similar to those for the no LTs configuration, the results for the LTs configuration show that the multiobjective optimization outperforms the decoupled optimization in terms of system-wide cost. Hence, it is economically beneficial to jointly consider all parties within the supply network. Further, we compare the model configurations LTs versus no LTs, and we show that using LTs improves the overall savings of the system. It is observed that the improvement is mostly derived from reduced shortage costs since the equipment downtime is reduced due to the proximity of the supply. The models and results of this research have significant practical implications as they can be used to assist decision-makers to determine when and where to pre-position parts inventories to maximize equipment availability. Furthermore, these models can assist in the preparation of the terms of long-term service agreements and maintenance contracts between original equipment manufacturers and their customers (i.e., equipment owners and/or operators), including determining the equitable allocation of all system-wide cost savings under the agreement.

Poor quality of information and forecasting create a number of problems for manufacturing companies, such as poor planning of products and insufficient service levels, which leads to increased inventory and stock holding or stockouts and increased total costs. Cussons (UK) Limited is experiencing precisely these problems. Apart from these problems normally associated with forecasting demand for fast moving consumer goods there is an additional problem of reconciling the Western calendar with the Muslim calendar, and a recognition of the effects that Muslim religious holidays, as opposed to Christian religious holidays, have on demand. Muslim religious holidays rotate backwards with regard to the Western calendar, but in fact they occur at known dates and therefore the effect they have on demand for products can be taken into consideration when attempting to forecast demand. An additional problem that influences Cussons' sales in the market is the seasonal pattern of demand. Due to this, there is an increase in demand for Cussons' products during summer months. From the analysis of both data sets it was identified that the warehouse movement data is less variable and more reliable for business forecasting than order data. In this thesis, these forecasting problems are examined as a case study, focusing on these particular problems. To overcome these problems and to improve business forecasting of Cussons' products in the Middle East market, a forecasting strategy has been suggested which will enable Cusson's to reduce the inventories throughout the supply chain and to improve their customer's service. / Ministry of Education, Government of Pakistan, Cussons (UK)Limited.

Inventory management in car dealership enterprises is one of the main goals to promote competitiveness and also a key success factor of sustainable economic development. The purpose of the thesis involves improving car dealership enterprises’ inventory management. The thesis is concerned with theoretical approaches to inventory management. Educational literature, statistical data of the Federal State Statistics Service, corporative statistics data and also results of opinion pull findings were used as the basis for the research. In the master thesis was represented the algorithm of order and shipment of items, based on turnover ratio, storage period and sales variation coefficient. The key element of the algorithm lies in accounting of individual optional equipment of each item, not the item itself. Implementation of the described algorithm serves to reduce storage period of items, thereby driving down carrying costs. / Управление товарными запасами на дилерском предприятии является одним из факторов обеспечения конкурентоспособности и залогом устойчивого экономического развития. Цель работы заключается в совершенствовании управления запасами на предприятии. В работе рассматриваются теоретические подходы к управлению запасами на предприятии. Учебно-методическая литература, статистические данные Федеральной службы государственной статистики, данные корпоративной статистики и данные, полученные в ходе социологического опроса были использованы в качестве источников информации для проведения исследования. В ходе написания магистерской диссертации был разработан алгоритм заказа и отгрузки с распределительного склада автомобилей, который основан на учете коэффициента оборачиваемости, срока хранения и коэффициента вариации по результатам продаж, особенностью которого является учет индивидуального опционального оснащения в каждой заказанной единице товара, что позволяет сократить срок хранения товара на складе, тем самым способствуя сокращению затрат предприятия на хранение запасов.

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Visibility refers to availability of information in real-time to requiring actors so that strategy and operations can be monitored, controlled and changed. A symptom of lack of visibility in inventory management is when information in IT systems does not accurately match what is present in the physical inventory. While there are studies in the area of scientific literature documenting reasons for inventory inaccuracy, a literature gap exists for inventory accuracy in relation to service field operations. This study's objective is therefore to examine what reasons are causing lack of inventory visibility in service field operations and which affected KPI are the most impacted by this lack. The study was designed as a case study at an industrial tools and equipment manufacturer, featuring observations and interviews. A visibility assessment approach to extract affected KPI was also applied. The results found that reasons causing lack in service field operations stem from how company IT systems are designed and in how accurately information is entered by employees in said IT system. It further found that a service technicians' years of service influences the inventory accuracy of their van inventory. Unclearly defined areas of responsibility and accountability were further found to contribute to lack of inventory visibility. The most affected KPI impacted were found to be Inventory in % of COGS and Provision in % of inventory, the reasons being that a lack of visibility leads to higher inventory levels and an increase in provisions. / Synlighet i en lagernivåkontext syftar till att information skall finnas tillgänglig för berörda aktörer i realtid så att strategier och operationer kan övervakas, kontrolleras och förändras. Ett symptom på synlighetsbrist i lagernivåer är när information i IT-system inte matchar med vad som finns fysiskt tillgängligt i lagret. Vetenskapliga studier har dokumenterat olika anledningar till felaktigheter i lagerinformation, dock existerar ett litteraturgap gällande hur felaktigheter i lagerinformation uppstår i relation till servicefältverksamheter. Syftet med denna studie är därför att undersöka vilka skäl som orsakar brist på lagersynlighet i servicefältverksamheter och vilka KPI som påverkas mest av denna brist. Studien utformades som en fallstudie hos ett industriföretag. Observationer och intervjuer utfördes, dessutom tillämpades en synbarhetsbedömningsmetod för att extrahera påverkade KPI. Resultatet av studien visar att orsaker som vållar brist i servicefältverksamheter orsakas av hur företagets IT-system är utformade och från hur noggrant information bokförs av anställda i nämnda IT-system. Studien fann även att en serviceteknikers år i tjänst påverkar graden av felaktigheter dennes tjänstefordons lagernivåer. Oklart definierade ansvarsområden och ansvarsskyldighet upptäcktes vidare bidra till bristande synlighet i lagernivåer. De mest drabbade KPI konstaterades vara Inventory in % of COGS och Provision in % of inventory, orsakerna till detta är att synlighetsbrister leder till högre lagernivåer och en ökad volym avsättningar.

In the currently dominating linear economy, there is a strong focus on the forward supply of products, where products and materials are being replaced and wasted at an increasing pace. In addition to this, there are products not even reaching customers, being scrapped as a result of them being excess in inventories. As the increasingly noted circular economy aims to control the flows of materials so that these are circulated and the value of them is kept as high as possible while minimizing waste, it offers a set of tools useful to increase the material efficiency of excess inventories. The purpose of this thesis is to investigate how improved inventory management can increase material efficiency from a circular economy perspective, to improve environmental and economic sustainability performance. A case study was completed at a global company in the ICT manufacturing sector where the current processes for handling excess inventory were studied along with the implications of product modularization. While exploring this topic, the thesis further aims to identify barriers and potentials to improving inventory management from the circular economy perspective. In enabling this, a qualitative study was performed, collecting empirical data through interviews with employees and researchers to use as the base for analysis and discussion. The findings present that although processes for managing products in excess inventory exist at the case company, there is great room for improvement regarding both a wider application of these along with the incentives and efficiency of them. The selection of products to be recirculated is today greatly dominated by economic factors, where typically only high-value products tend to be considered and the environmental aspect is somewhat lost in this consideration. Moreover, modularization is identified as an enabler for increased material efficiency in inventory management, reducing unique components and materials in inventories and thereby the risk of scrapping. However, these positive effects of modularization on the material efficiency are unfortunately not expected to be seen in the nearest time, but rather in the future. Furthermore, several barriers to improved inventory management are identified, also indicating the existing potentials for improvement and capabilities required for this. The most prominent barriers recognized are organizational, technological and economic barriers. The majority of them are internal barriers existing within the organization. / I den för närvarande dominerande linjära ekonomin finns ett starkt fokus på det framåtgående flödet av produkter, där produkter och material byts ut och slösas i en allt ökande takt. Utöver det här produktflödet finns dessutom produkter som aldrig når kund, utan som skrotas på grund av att de är i överskott eller har blivit föråldrade medan fortfarande i lager. Då den alltmer uppmärksammade cirkulära ekonomin syftar till att kontrollera flödena av material så att dessa cirkuleras och hålls vid ett så högt värde som möjligt samtidigt som avfall minimeras, erbjuder den en uppsättning användbara verktyg som kan användas för att öka materialeffektiviteten i överskottslager. Syftet med studien är att undersöka hur förbättrad lagerhantering kan öka materialeffektiviteten ur perspektivet av den cirkulära ekonomin, med syftet att förbättra miljömässig och ekonomisk hållbarhetsprestanda. En fallstudie utfördes vid ett globalt företag inom den tillverkande ICT-sektorn där de nuvarande processerna för hantering av överskottslager studerades tillsammans med implikationerna av att modularisera delar av produktportföljen. I undersökningen av detta syftar studien vidare till att identifiera barriärer och potential för förbättrad lagerhantering utifrån den cirkulära ekonomins principer. Detta utfördes genom en kvalitativ studie där empirisk data samlades in genom intervjuer med anställda samt forskare, vilken låg till grund för den analys och diskussion som genomförts. Resultaten visar att även om det i dagsläget finns processer för att hantera produkter i överskottslager hos fallföretaget, finns det stort utrymme för förbättring gällande effektiviteten av dessa. Urvalet av produkter för återcirkulering domineras idag till hög grad av ekonomiska faktorer, där oftast enbart produkter av högt ekonomiskt värde prioriteras för återcirkulering, och hållbarhetsaspekten förloras på vägen. Vidare identifieras modularisering som en möjliggörande faktor till förbättrad lagerhantering där färre unika komponenter och reducerade materialnivåer i lager minskar risken för skrotning. De positiva effekterna av modularisering på materialeffektiviteten inom lagerhantering förväntas däremot bli synbara på lång sikt snarare än kort sikt. Avslutningsvis identifieras flertalet barriärer till förbättrad materialeffektivitet inom lagerhantering, vilka indikerar de befintliga möjligheterna till förbättring. De mest framstående typerna av barriärer inkluderar organisatoriska, tekniska och ekonomiska barrirärer, där det kan konstateras att merparten är interna barriärer som kan hanteras inom organisationen.