How much should I make when demand is uncertain? How much should I order?  How much is too much when inventory has a shelf life after which it is no longer usable or sellable? 

These are uncertain times.  For many industries, past sales are no longer valid in predicting future demand. At least not until the economy gets back to a new normal after the pandemic.  Demand is way down, or even completely gone in some industries (such as foodservice and travel).  Demand is way up or at record levels in other industries (such as PPE and cleaning products).

This is the first in a series of blogs on the topic of lot sizing to determine optimal batch quantity for production or ordering in uncertain times.  I’ll explore some of the historical methodologies and some of the newer philosophies.  My focus is on adapting these methodologies and philosophies for products with finite shelf life when demand is uncertain.