Seasonal and Build Inventory (SBI)

Seasonality and build inventory (SBI) levels production, machine, line and plant utilization. One of our clients is a large frozen food manufacturer and one of the largest producers of frozen pies. The large majority of those pies are purchased by consumers between Thanksgiving and Christmas; a short 30 day window.  The demand rate then is so much greater than the demand rate during the remaining 335 days of the year that to match manufacturing capacity to demand during those days would render manufacturing virtually idle for eleven months of the year. Instead, the company produces pies at a fairly even rate during the year and stores the “build” inventory for the season in large, third-party frozen food warehouses. An example build plan to meet demand and fill rate requirements while minimizing total supply chain cost is illustrated below.

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