A rule-based multi-criteria approach to inventory classification

Abstract

The traditional inventory classification method classifies stock keeping units (SKUs) to three classes based on their annual dollar usage, while in real world problems, other criteria are important as well. In this paper, considering multi-criteria situations, a simple, effective and practical rule-based method is designed and implemented in a real world case, using MATLAB software. The most important characteristic of the proposed method is taking into account the inherent ambiguities that exist in the reasoning process of the system of classification. The methodology and the method proposed here may be easily implemented by inventory managers. The results obtained from the case study in this paper are compared with the analytic hierarchy process (AHP) method. Finally concluding remarks and suggestions for future work are provided.