Method and system for optimizing product inventory cost and sales revenue through tuning of replenishment factors
AssigneeTeradata Corporation
InventorArash Bateni
Life of this patent
Estimating the term…
Abstract
A method and system for predicting the impact of replenishment levers on product service level, lost sales, and on-shelf availability for a retailer. The method and system models cost and revenue elasticity curves for a product or group of products and analyzes the cost and revenue elasticity curves, measures the impact of tuning the replenishment levers on inventory cost and sales revenue, and identifies values for the product replenishment levers to optimize replenishment system policies and product profitability.
Claims21
A computer-implemented method for managing product replenishment levers to increase product profitability, the method comprising the steps of:
- maintaining, in a data storage device, a database of historical demand values for a product;
- determining, by a computer in communication with said data storage device, a demand distribution model for said product from said historical demand values;
- determining, by said computer, an inventory costs model for said product from replenishment levers and inventory data for said product obtained from a replenishment system;
- analyzing, by said computer, said demand distribution model and said inventory costs model to identify values for the product replenishment levers to increase product profitability.
A system for managing product replenishment levers to increase product profitability, comprising:
- a data storage device containing a database of historical demand values for a product;
- and
- a computer in communication with said data storage device, for:
- determining a demand distribution model for said product from said historical demand values;
- determining an inventory costs model for said product from replenishment levers and inventory data for said product obtained from a replenishment system;
- analyzing said demand distribution model and said inventory costs model to identify values for the product replenishment levers to increase product profitability.
A non-transitory computer-readable medium having a computer program for managing product replenishment levers to increase product profitability, the computer program including executable instructions that cause a computer to:
- determine a demand distribution model for said product from historical demand values;
- determine an inventory costs model for said product from replenishment levers and inventory data for said product obtained from a replenishment system;
- analyze said demand distribution model and said inventory costs model to identify values for the product replenishment levers to increase product profitability.
Dependencies are inferred from the claim text.