ARMY LOGISTICS MANAGEMENT CENTER FORT LEE VA FORT LEE
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Stock rationing is the attempt to insure that scarce material goes where it can do the most good. Two forms of stock rationing are investigated for application at the NICP level. A reserve for high priority requisitions is designed to channel scarce stock away from low priority users to high priority users. The value of maintaining a reserve is empirically shown. A mathematically optimum method for setting the size of the reserve level is developed. This and other methods are empirically compared. A simple rule for setting reserve levels is recommended which bases the level at any given time on the high priority demand expected during the time remaining before stock replenishment. It is shown how to implement this rule in a multi-priority system. Reduced shipments can be made to economize on scarce stock. The use of such a procedure is investigated in the case where the requisitioner is ordering in economic quantities to replenish his own supplies rather than for immediate use. It is shown that proper application of the procedure provides a way of improving supply performance which is inexpensive relative to the costs of raising the safety level.
- Logistics, Military Facilities and Supplies