Inventory Optimization Objective Cost
The Servigistics Inventory Optimization calculation integrates a suite of
Marginal Analysis algorithms that minimize inventory investment subject to a configurable combination of aggregate performance targets and SKU constraints and overrides.
The
Inventory Optimization Objective Cost feature expands on that capability by allowing you to specify the cost used to make stocking decisions during the calculation of a Scenario. You can use the standard
Part Cost, or you can specify an
Optimization Cost to be used to find an optimal stock level mix that reduces backorders or increases fill rate at the lowest possible cost of the parts being selected. This feature can be beneficial to use when you want to minimize inventory costs or incorporate factors other than
Part Cost. For example:
• Reduce carbon footprint
• Honor vendor incentives
• Apply promotional sales
• Reduce the sensitivity of cost-based optimization on low cost parts that require high levels of service