Applying inventory model for consumable products

Abstract

Consumable products have short shelf life. Management of such products requires a controlled temperature storage in order to prevent premature deterioration. The purpose of this study therefore is to manage and control consumable products through purchasing process that takes the product shelf life into consideration in order to find the optimal quantity. The process begins with product categorization according to ABC theory. Since the control of all products is cumbersome and unnecessary, the theory is applied only to the products with high annual consumption rate. The forecasting theory is then applied in order to identify trends in the product requirement and estimate for the optimal quantity. The result of the study finds that applying inventory theories to the problem enables us to estimate for optimal quantity of purchase which is adequate to the requirement. Finally, the management of consumable products enable a more effective budget management.