May 2020
Article
Production and Operations Management

Inventory Auditing and Replenishment Using Point-of-Sales Data

By: Achal Bassamboo, Antonio Moreno and Ioannis Stamatopoulos

Format:Print

Abstract

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, i.e., 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 projected service-level threshold policy performs comparably to the optimal.

Keywords

Shelf Availability; Inventory Record Inaccuracy; Optimal Replenishment; Retail Analytics; Performance Effectiveness; Analysis; Mathematical Methods

Citation

Bassamboo, Achal, Antonio Moreno, and Ioannis Stamatopoulos. "Inventory Auditing and Replenishment Using Point-of-Sales Data." Production and Operations Management 29, no. 5 (May 2020): 1219–1231.