Inventory model for ordering two raw materials from a single source of coffee shop : case study

Abstract

This research aimed to formulate the inventory model for ordering two materials from a single source, which were condensed milk and evaporated milk. The inventory model was utilized to find the economical ordering quantity, ordering period, appropriate ordering frequency, re-order point and safety stock. The results indicated that there was no statistically significant difference for the average total inventory cost of condensed milk and evaporated milk. However, the proposed inventory model reduced the current average total inventory cost by 47.82% and 48.38%, respectively. In addition, there was no statistically significant difference for the current and the purposed average inventory quantity of condensed milk. However, the proposed inventory model reduced the current average total inventory quantity of condensed milk by 31.31%. For evaporated milk, there was statistically significant difference for the current and the purposed average inventory quantity. The purposed inventory model reduced the current average total inventory quantity of evaporated milk by 64.72%.