ABSTRACT
In this chapter, the author demonstrates how the Theory of Constraint's Distribution and Replenishment Model can be used to reduce inventories by 50% or more, while simultaneously eliminating these troublesome stock-outs. Many businesses are using manpower efficiency or equipment utilization to measure the performance of their processes and, as a result of these performance metrics, they work to increase these two metrics. The benefits of TOC's replenishment solution can be very striking. After completing the daily refill of the vending machines, the soda person returns to the warehouse, or distribution point, to replenish the supply on the soda truck and get ready for the next day's distribution. Stock-outs and high inventory levels are common problems for many companies and most supply-chain systems. If the current supply-chain system is continued, then the results will remain unchanged.
