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Inventory Auditing and Replenishment Using Point‐of‐Sales Data
Author(s) -
Bassamboo Achal,
Moreno Antonio,
Stamatopoulos Ioannis
Publication year - 2020
Publication title -
production and operations management
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 3.279
H-Index - 110
eISSN - 1937-5956
pISSN - 1059-1478
DOI - 10.1111/poms.13153
Subject(s) - audit , point of sale , business , service (business) , point (geometry) , customer service , computer science , operations management , lost sales , operations research , marketing , economics , mathematics , accounting , geometry , world wide web
Spoilage, expiration, damage due to employee/customer handling, employee theft, and customer shoplifting usually are not reflected in inventory records. As a result, records often report phantom inventory, that is, units of good not available for sale. We derive an optimal polynomial‐time algorithm for the auditing and replenishment problem with phantom inventory, under the assumption that inventory is known immediately after replenishment. Moreover, we numerically show that a service‐level threshold policy performs comparably to the optimal.