Inventory planning of raw material using Silver Meal and Wagner Whitin Algorithm

Abstract

Material inventory planning is needed in the industrial world to advance a business because it will affect the costs incurred, the production process, and the profits generated by the company. The company has a problem that occurs when the control of raw material inventory could be more optimal. It recorded that throughout 2021, 33.647,18 meters of fabric pants were stored in warehouses. This is influenced by several factors, including the calculation of safety stock, lead time due to uncertain logistics and the selection of methods that have not been maximized. The novelty of this research is that it discusses inventory planning, the methods used are Silver Meal Algorithm and the Wagner Whitin Algorithm. Data processed is on demand for clothes and jeans throughout 2021. The results show that the Silver Meal is suitable for five materials, and the Wagner Whitin Algorithm is on one material. Companies can use both methods for each raw material. Nevertheless, it is more optimal if the company utilizes only one method for procurement of raw materials, the Silver Meal because when it is used in the long term, the cost of raw materials is less than the Wagner Whitin Algorithm. The Siler Meal’s total inventory cost is Rp. 138.281.497, and the Wagner Whitin Algorithm is Rp. 170.010.097