Safeway Inventory Analysis

Inventory Management 186278 Accurate inventory control for a grocery store such as Safeway is monumental. A customer that is shopping at a grocery store, such as Safeway, expects to find the shelves full of items it normally sells. The frustration a customer might experience from an empty shelf could cause more damage than just a lost chance at revenue from a sale. In order to maintain a fully stocked shelf, Safeway utilizes an inventory management system (Inventory Management, 2016). It could lose a customer’s patronage if he or she goes to a competitor, such as Food Maxx, and finds every item he or she is seeking.
Inventory Models Walking through a Safeway, one will find it has a variety of goods on the shelves. A new customer, hungry for a delightful salad
The EOQ model assumes goods are not subject to discounts for bulk ordering and where the specific demand and lead time are known for a particular product. Timing of orders is critical to ensuring no stock outs happen, even during unplanned events and seasonal changes (Heizer & Render, 2014). If a customer finds that a store such as Safeway never runs out of what he or she is looking for, a lifelong relationship could generate.
Conclusion
Stock outs are profit and revenue nightmares; therefore, accurate and timely inventory management can enable a company to manage its stock and minimize any chance of stock outs. Utilizing inventory models such as EOQ, Safeway can reduce its holding costs and set up costs, thereby increasing revenue. Another key component to CRP is utilizing real time data acquired from stores and distribution centers; thereby, balancing out its ordering and storing needs. These processes not only increase revenue by cutting costs, it also helps ensure when a customer reaches for an item on a shelf, the product will be in