Two-Bin Inventory Control

Posted in Operations and Supply Chain Terms, Total Reads: 1001
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Definition: Two-Bin Inventory Control

Inventory control methodology (used typically for tiny or low price items) during which once the primary bin is employed up, Associate in Nursing order is formed out for filling. The second bin contains enough amount of the item to last till the ordered amount arrives.


Explanation

Two bin systems area unit common on assembly and moving producing lines wherever elements area unit added to the merchandise or item being designed. The 2 bin system is simply like its name suggests, it's composed of 2 bins that area unit filled with elements or materials to start out. As production commences one bin is drawn down of materials and therefore the alternative bin, that continues to be full, acts because the buffer or safety stock.

 

When the primary bin is totally depleted the employee or production line employee switches to the opposite bin, almost like a first in first out system. The switch of bins are often understood as a kanban signal for the provision method of that specific part to manufacture or supply the part simply in time before the second bin runs out of fabric. The kanban signal may be generated 0.5 method throughout the primary bin, counting on lead times for the part to be equipped.

 

This system in an exceedingly method is analogous to the EOQ inventory model with safety stock. It's a awfully common system utilized in vehicle producing plants. The scale or variety of elements in every bin is sometimes determined mistreatment the EOQ inventory model or a period of time model.

 

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