There are many planning techniques that Fisher Scientific implements when forecasting inventory and demand. When planning for the demand of a service or product, Fisher focuses on a reorder point bases. When inventory on product drops below the reorder point, this queues up in the purchasing system. When calculating the total reorder point, the planning group analyzes two parts. The fist segment consists of statistical data that is calculated dependant on what minimum amount of product is needed to supply the customer demand and safety stock requirements. Safety stock is needed to ensure inventory for unplanned demand. Fisher usually calculates ten percent of the average demand and adds that amount to the purchase quantity. Another section needed to calculate total reorder point is adjusted. This allows inventory planners to adjust certain reorder points or demand figures dependant upon whether a customer wants product to be held at a Fisher warehouse for a specified amount of time.
This will give the customer a guarantee that product is in stock at the time they need the material.
Fisher Scientific also forecasts demand using the logility system. This system forecasts using three years of previous demand and order history. The system examines this information using various forecasting models such as exponential smoothing and three month moving average. This data is weighted and examined so the correct model is used to predict average lead time on fast moving products. This information is calculated three years back for accuracy and further demand history.
At Fisher, the research department has a higher flow of demand around the winter seasons due to flu shots and medications needed. The education inventory tends to have more demand in the summer months prior to school starting. Each division of Fisher has its' own seasonal flow. By analyzing...