Retail stock allocation with probabilistic forecasts - Lecture 6.1

Supply chain decisions require risk-adjusted economic assessments. Converting probabilistic forecasts into economic assessments is nontrivial and require dedicated tooling. However, the resulting economic prioritization, illustrated by stock allocations, proves itself more powerful than traditional techniques. We start with the retail stock allocation challenge. In a 2-echelon network that includes both a distribution center (DC) and multiple stores, we need to decide how to allocate the stock of the DC to the stores, knowing that all stores compete for the same stock.

******
Time stamps:
0:00:00 - Introduction
0:02:23 - Decisions vs Artifacts
0:10:07 - Experimental optimization
0:13:51 - The story so far
0:17:01 - Today's decisions
0:19:36 - The manifesto of the quantitative supply chain
0:21:01 - The retail stock allocation problem
0:24:49 - Economic forces on the store SKU
0:29:35 - Reifying the futures
0:32:41 - Reifying the options - 1/3
0:38:25 - Reifying the options - 2/3
0:43:02 - Reifying the options - 3/3
0:44:44 - Stock reward function - 1/2
0:51:41 - Stock reward function - 2/2
0:56:19 - Prioritized stock allocations - 1/4
0:59:59 - Prioritized stock allocations - 2/4
1:03:39 - Prioritized stock allocations - 3/4
1:06:34 - Prioritized stock allocations - 4/4
1:12:58 - Smoothing the warehouse flow - 1/2
1:16:48 - Smoothing the warehouse flow - 2/2
1:22:12 - Action reward function
1:25:02 - The real world is messy
1:27:38 - Conclusion
1:30:00 - 6.1 Retail stock allocations with prob. forecasts - Questions ?

******
Check out our website: https://www.lokad.com/
Follow us on LinkedIn:   / lokad  
Follow us on Twitter:   / lokad  
Read our blog: https://blog.lokad.com/
Sign-up for the Lokad newsletter: https://www.lokad.com/home#news