Title: Deciding on inventory allocation policies in the auto parts Brazilian distribution chain

Authors: Fabio Cardoso; Maria Lucia Galves; Jose Vieira

Addresses: Graduate Program in Production Engineering (PPGEP-So), Federal University of Sao Carlos, Joao Leme dos Santos, KM 110, Itinga, 18072-780, Sorocaba/São Paulo, Brazil ' Faculty of Civil Engineering, Architecture and Urbanism, Department of Geotechnics and Transport, State University of Campinas (UNICAMP), Rua Saturnino de Brito, 224, 13083889 – Campinas, SP, P.O. Box 6143, Brazil ' Graduate Program in Production Engineering (PPGEP-So), Federal University of Sao Carlos, Joao Leme dos Santos, KM 110, Itinga, 18072-780, Sorocaba/São Paulo, Brazil

Abstract: The purpose of this paper is to evaluate the decision regarding whether to centralise or decentralise the stock of auto parts in Brazilian context. Extensive research was conducted regarding stock allocation policies, with a focus on centralisation and decentralisation, whereas the criteria for this decision were actually validated according to the opinion of Brazilian dealerships. A survey of 119 dealers revealed the important criteria for decision making using the analytic hierarchy process (AHP) approach. Our results demonstrate that dealerships assign high importance to delivery lead time, quality and flexibility in the delivery process from automakers. The results reveal that the simple trade-off between service level and inventory cost does not offer a definite distribution net design regarding stock allocation policies. This paper contributes by showing the criteria related to different types of stock allocations influence the decision regarding whether to centralise an auto parts' distribution chain in Brazil.

Keywords: stock allocation; centralisation; service level; transportation.

DOI: 10.1504/IJSOM.2022.123335

International Journal of Services and Operations Management, 2022 Vol.42 No.2, pp.246 - 266

Received: 06 Jun 2019
Accepted: 21 Dec 2019
Published online: 10 Jun 2022 *

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