An assessment of FIFO and LIFO policies for perishable inventory systems using the system dynamics approach
Added Title
IEEE International Conference on Industrial Engineering and Applications (6th : 2019)
ICIEA 2019
College
Gokongwei College of Engineering
Department/Unit
Industrial Engineering
Document Type
Conference Proceeding
Source Title
2019 IEEE 6th International Conference on Industrial Engineering and Applications, ICIEA 2019
First Page
251
Last Page
255
Publication Date
5-14-2019
Abstract
This study applied the System Dynamics methodology in evaluating the equilibrium state performance of First-In-First-Out (FIFO) and Last-In-First-Out (LIFO) for perishables. It recognizes that while a certain policy may have optimal results for a few successive periods, it may produce undesirable patterns in the long-term (e.g. accumulation of old stock). A non-perishables scenario was simulated for each policy to validate the logic of the model, and for comparison. This revealed that while FIFO and LIFO have little difference in the long-term for non-perishables, there is a major difference for perishables. Based on the results, this study concludes that LIFO is superior in equilibrium, in terms of consistency in quality of goods sold and stability of production rate. © 2019 IEEE.
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Digitial Object Identifier (DOI)
10.1109/IEA.2019.8714839
Recommended Citation
Ching, P. L., & Wu, J. (2019). An assessment of FIFO and LIFO policies for perishable inventory systems using the system dynamics approach. 2019 IEEE 6th International Conference on Industrial Engineering and Applications, ICIEA 2019, 251-255. https://doi.org/10.1109/IEA.2019.8714839
Disciplines
Industrial Engineering
Keywords
First in, first out (Accounting); Last in, first out (Accounting); Perishable goods—Inventories
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