Measuring the effectiveness of allocation algorithms by means of simulation modelling

[摘要] ENGLISH ABSTRACT: The allocation of stock to stores is one of the most important processes in the managementof a retail chain. In the clothing industry, allocation decisions include, amongst other, thedetermination of the number of each size (for example small, medium and large) to send to eachstore. A case study of this problem in Pep Stores Ltd. (PEP), a major retailer in South Africa,is considered.In PEP, products are ordered from factories about seven months before they are available in thestores. They are then shipped to the distribution centra, after which they are distributed perroad to the stores. Before the products are ordered, preliminary allocation decisions are made.Once the stock arrives at the distribution centra, decisions about the allocation of products andsizes to the stores arenalised. Allocation decisions are adjusted throughout the season as morerecent sales data become available.In this thesis, simulation models are developed to compare four allocation methods in terms oftotal expected sales, shortages and surpluses. The algorithms include PEP's current algorithm,an existing algorithm that minimises the expected number of weeks that shortages and surplusesoccur at stores, a new algorithm with the objective to maximise expected sales, and a relaxationof the new algorithm.The simulation models are developed according to two modelling approaches. Each approach isapplied to Summer and Winter products, resulting in four simulation models. The two simulationapproaches deliver similar results for both Summer and Winter products, namely that all fourallocation methods are approximately equally e ective.

[发布机构] Stellenbosch University