Abstract:
Inventory Management in Construction Material Retailers: A Case Study of Superhome Trading Company, Chiang Rai Provinces objectives are as followed: 1. To study the inventory management in construction materials retailers; and 2. To study the guideline for inventory management in construction material retailers by the use of ABC Analysis, Economic Order Quantity (EOQ), and Reorder Point (ROP). Through interviews and studies of collected data, the research found that inventory management of the company still possessed errors and problems as followed: Firstly, the number of purchasing was managed by only one manager who was lack of consideration for related expenses. Secondly, the quantity of purchasing was decided solely based on the experience of one manager without the use of Economic Order Quantity (EOQ) and Reorder Point (ROP) analysis. Lastly, the inspection of number of inventory from computers was lack of accuracy. The actual number of inventory and the number of inventory in the computer were not the same. This type of error could potentially result in the failure of purchasing, especially when the company needed to order a great number of merchandise to minimizing the costs. Based on errors and problems mentioned above, the researcher had utilized ABC Analysis to categorize merchandises for easier control of the inventory. In addition, the researcher used Economic Order Quantity (EOQ) to find the most economical point in ordering to save purchasing costs. Lastly the researcher used Reorder Point (ROP) to help calculate and identify the particular level of inventory for reordering prior to the merchandise shortage.
After calculating the total costs both before and after by the use of Economic Order Quantity (EOQ), the results are as followed: The research revealed that the total costs that happened before using Economic Order Quantity (EOQ) was 978,584.65 Baht. However, the total cost after using Economic Order Quantity (EOQ) was 625,626.79 Baht. The use of Economic Order Quantity (EOQ) method resulted in the decrease in overall total costs by 352,957.79 Baht or 36 percent. The category of merchandise with the highest cost saving value was Construction Equipments, reduced by 42.27 percent.