Setting Push-Pull Boundaries: A Case of Textile Manufacturer

This chapter discusses a case study to define the push-pull boundary for both continuous and periodic review policies. It compares the cost for push-based supply chain and combined-based supply chain strategy. It focuses on how to set push-pull boundaries to benefit from both the push and pull systems with a case of a textile manufacturer. The chapter demonstrates the concept of setting push-pull boundaries and their outcome through the means of analytical examples. Continuous review policy is driven by the amount of inventory level. The inventory position at any point in time is the actual inventory at the warehouse, plus the items ordered by the distributor that have not yet arrived, minus the items that are backordered. In periodic review policy, the inventory is reviewed on a routine basis. While everything else remains same and equal, higher demand uncertainty leads to preference for managing the supply chain based on demand realization, a pull strategy