Inventory redistribution process with fine granular real space information - Proposal and evaluation using a specialty store's supply chain

With the recent progress in information technology systems equipping with ubiquitous computing technology, it has become feasible to manage objects in real space on an individual item level, in real time, across more locations than before. In this study, we refer to this information with high granularity as fine granular information, and the management that utilizes this information as fine granularity management (FGM). This study proposes an inventory redistribution process that is enabled by FGM and evaluates the operational impact of this process. This proposed process premises dynamic item allocation and solves inefficiency in the supply chain management (SCM) of short lifecycle items. The problem we deal with is a single period stochastic inventory management problem that retailers with multiple stores face, and future demand and amount of items for redistribution are computed using the proposed algorithm. We evaluate our proposal using SCM operation data disclosed by a real-life specialty store company and show the effectiveness of our proposal.