Planning for Demand Uncertainties
During Promotional Cycles of Modern Retail

- by Sauraraj Nath & Vikrant P. Bawane *

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Customers usually perceive quality service as availability of goods they want. When they want them, the inventory must be sufficient to provide high-quality customer service. Indian retailers generally follow traditional inventory management techniques by using the Maximum Base Quantity (MBQ) of a SKU as a criteria for adopting reorder-level, stock-days, and safety-stock for a given service level.

The following Exhibit 1 depicts a typical inventory management practice of a retailer.

Exhibit 1

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* Contributed by: -
Sauraraj Nath & Vikrant P. Bawane,
Post Graduate Programme in Agribusiness Management (PGPABM) II,
National Institute of Agricultural Extension Management (MANAGE), Hyderabad.

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