Taxonomy of inventory policies for supply‐chain effectiveness

The concept of taxonomy is applied to inventory management in a supply‐chain using the example of the US textile industry. Through classification and standardisation of issues related to inventory management problems, it is shown how inventory models and techniques can be generalised across diverse application environments represented by autonomous business entities that form the supply‐chain. Three generic models that implement inventory decision rules to address constant (or level), time varying (or chase), and mixed demand patterns associated with stock keeping unit (SKU) categories are proposed. Applications of these inventory models to a textile supply‐chain are discussed.