fixed property

Property attached to, and not easily removed from, the location.

A form of independent demand management model in which an order is placed every n time units. The order quantity is variable and essentially replaces the items consumed during the current time period. Let M be the maximum inventory desired at any time, and let x be the quantity on hand at the time the order is placed. Then, in the simplest model, the order quantity will be M - x. The quantity M must be large enough to cover the maximum expected demand during the lead time plus a review interval. The order quantity model becomes more complicated whenever the replenishment lead time exceeds the review interval, because outstanding orders then have to be factored into the equation. These reorder systems are sometimes called fixed-interval order systems, order level systems, or periodic review systems. Syn: fixed-interval order system, fixed-order quantity system, order level system, periodic review system, time-based order system. See: fixed reorder quantity inventory model, hybrid inventory system, independent demand item management models, optional replenishment model.

A form of independent demand item management model in which an order for a fixed quantity, Q, is placed whenever stock on hand plus on order reaches a predetermined reorder level, R. The fixed order quantity Q may be determined by the economic order quantity, by a fixed order quantity (such as a carton or a truckload), or by another model yielding a fixed result. The reorder point, R, may be deterministic or stochastic, and in either instance is large enough to cover the maximum expected demand during the replenishment lead time. Fixed reorder quantity models assume the existence of some form of a perpetual inventory record or some form of physical tracking, e.g., a two-bin system that is able to determine when the reorder point is reached. These reorder systems are sometimes called fixed order quantity systems, lot-size systems, or order point-order quantity systems. Syn: fixed order quantity system, lot-size system, order point-order quantity system, quantity-based order system. See: fixed reorder cycle inventory model, hybrid inventory system, independent demand item management models, optional replenishment model, order point, order point system, statistical inventory control, time-phased order point.