Track: Production Planning and Control

Abstract

Aggregate planning has been widely used by apparel manufacturers to gain maximum profit by finding the optimal solution between maximizing sales and minimizing production cost. Commonly, small apparel companies use chase strategy, where production rates are varied for each time period to meet changes in demand. However, without an appropriate demand forecast and well-calculated production planning, this strategy might not accommodate the fluctuating demand. It can cause recurring product stock outs which increases the number of unmet customer demands. To improve the company’s production planning, the number of demands is forecasted using single moving average (SMA) method for each week of the upcoming month. The forecasted demand is then used to plan the production quantity using Material Requirement Planning which helps ensure that all the demands are met while avoiding over-production by taking on-hand inventory into account. Comparison between the former and the improved production planning method shows an increase in the company’s sales, increasing profit by 37,33% or equal to Rp3.360.000. This concludes that the method proposed in this paper can be used as a simple yet effective way to improve the apparel company’s production planning, hence increasing the company’s profit.