DESIGNING OF INVENTORY MANAGEMENT SYSTEM USING WHAT IF ANALYSIS METHOD FOR ALUMUNIUM INDUSTRY IN PT.PQR

Abstract

Inventory is one of important factors in manufacturing industry. PT. PQR is an aluminium ingot manufacture company. The company has a problem to manage the inventory system for their main raw material. Inventory analysis condition did while 2015. PT. PQR have a big expenditure due to safety stock. Total inventory cost of PT. PQR based on current condition is $270,706. The proposed improvement method that used in this analysis is continuous review system. This method is applied to determine the appropriate Reorder Point (ROP) and to minimize the inventory cost. Based on the proposed improvement, total inventory cost can be reduced into 30% to be $190,497. This model were developed into Decision Support System by using what-if analysis method as the tool to make decision for the next period by considered the aspects that influence to decision.