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3.7.4 Summary

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In this section, we have seen that judgements need to be made before setting aggregate service targets. The choice of service level targets should be informed by the service offered by others and the degree to which inventory service is prioritised as a source of competitive advantage. Service targets may then be set for whole classes of SKUs or differentially for each individual SKU.

Software can be used to conduct experiments at aggregate or SKU level, to show the inventory consequences of different service level targets. It is important to undertake such evaluations to ensure that the balance being struck between service and costs is one that reflects the aims of the organisation as a whole.

Intermittent Demand Forecasting

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