ON THE PURCHASE MODE OF LOW VALUE ITEMS

Authors
  1. Ng, K.Y.K.
Corporate Authors
Operational Research and Analysis Establishment, Ottawa ONT (CAN) Directorate of Mathematics and Statistics
Abstract
The paper develops a method to aid the supply managers in deciding on the purchase mode of low value items within the Canadian Forces. A trade-off formula is determined for the various cost factors involved and indifference curves are drawn to provide comparison of the critical attributes on which the purchase mode selection is based. A mathematical formula is also derived which would allow an economic balance between depot labour cost and materiel cost when deciding on the desired quantity of items per package. The method is conceptually simple, easy to implement and can be easily generalized to include more complex situations in other inventory and production studies. An empirical study is included to illustrate the method.
Report Number
DLA-STAFFNOTE-85/1 —
Date of publication
15 Apr 1985
Number of Pages
13
DSTKIM No
85-01643
CANDIS No
46452
Format(s):
Hardcopy;Originator's fiche received by DSIS

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