Inventory Allocation for Offline and Online Stocks for Fashion Industry

S. Sarifah Radiah Shariff, Shahrul Irda Said

Abstract


Fashion Industry is a fast moving industry that is always related to the demands and trends. In this industry, the fashion retailer’s supply chain covers the whole process flow of a product from the supplier or the vendor to the retailer as well as sales to the consumers. Nowadays, most retailers in fashion industry have both online and offline selling platforms. Hence, the right stock allocation for both online and offline is very important. When the allocation is not properly managed, product might not be able to be shipped even though it is physically available in the warehouse. The same scenario might happen in offline store where there  are not enough stocks to cater to the walk in customer especially during promotion and special launches. The failure in managing the inventory properly will result in the loss of sales and lead to customers’ loss of interest. In this study, the right allocation for both online and offline stocks is proposed through simulation technique which is based on the average probability of the current stocks demand for both online and offline ratio. The simulation results are then used to calculate the total inventory cost. It is shown that the total costs are comparable for current and proposed approach but the stock out possibility is minimized in the proposed allocation.


Keywords


Fashion Industry, online and offline business, inventory management, simulation for ratio

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References


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DOI: https://doi.org/10.25292/atlr.v1i1.40

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Advances in Transportation and Logistics Research

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