02 — Capability · BC-650.10
Inventory Policy & Optimization
Decide how much of each item to hold at each location, and why, so service targets are met with the least capital tied up in stock.
- Inventory Optimization
- Stocking Policy
- Safety Stock Planning
In scope
- Item classification and segmentation
- Safety stock and reorder parameters
- Stocking location decisions
- Excess and obsolete identification
Out of scope
- Generating replenishment orders from those parameters (see BC-610)
Realized by · 0
- No product in the catalog yet.
Used in · 1
Build it · 0
- Nothing in the library points here yet.
Decomposes into · 3
- BC-650.10.10Inventory SegmentationClassify items by value, velocity and criticality so that policy effort goes to the few items that drive most of the cost and risk.
- BC-650.10.20Stock Parameter SettingSet and periodically reset safety stock, reorder points and lot sizes from demand variability, lead time and the agreed service level.
- BC-650.10.30Excess & Obsolete ManagementFind stock that will not sell at its current rate, decide what to do with it and stop more of it being created.