A Simulation-Based Replenishment Model for the Textile Industry

This paper analyzes the replenishment problem faced by manufacturers who adopt the Vendor Management Inventory (VMI) replenishment strategy with the apparel retailers in the textile industry. Firstly, a replenishment model is proposed for the coordination of the interests of apparel manufacturers and retailers. A simulation-based optimization procedure is then elaborated to solve the replenishment problem. A simulation program is presented to generate the VMI replenishment strategy based on sales forecast data to satisfy the customer service level required by the retailers. With consideration given to production capacity constraints, a dynamic rolling optimization of the VMI replenishment strategy using simulation and genetic algorithm is then formulated to optimize the supply chain performance in terms of production balance of manufacturers and customer satisfaction targeted by retailers. The experimental results demonstrate that the proposed replenishment strategies can benefit the manufacturers with balanced production and maintain the customer service level at a certain degree.