The planning of iron sand inventory with System Dynamic Approach

Abstract

Abstract The need for iron sand as a supporting material of the cement making is increasing, so companies require planning of inventory control of iron ore to get all the needs in terms of quality and quantity. Inventory control planning will be useful to meet the demand and reduce inventory wastage. In the production process, companies often experience a shortage of materials when demand soared and raw materials excessed when demand decreases. This study aims to determine the best ordering method next year so that the company does not experience the stock shortage. The system dynamics method was applied with the help of Powersim software in terms of modelling and simulating the iron ore ordering system in the form of several scenarios. Based on the result, the best scenario was to order the iron ore as much as 4,013 tons/month, which is twice the amount in the previous policy, and the average inventory of the iron ore was 10,943 tons/month.