Petrochemical Case Study

Petrochemical

In the chemical product market, where price fluctuations are large, prompt response is the key to maximizing profits. By synchronizing sales, supply, and inventory operations, planning (Plan), execution (Do), evaluation (Check), and improvement (Act) can be performed quickly.

industry Petrochemical manufacturer
Business description Manufacture and sale of petrochemical products
Installation module Demand Forecast (Statistics) | Sales Plan | Supply Plan | Production Planning | Analysis & Report
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Background

"Company A", a leading petrochemical manufacturer, has established a new business division and constructed a state-of-the-art production plant to produce high-value-added petrochemical products. With the implementation of a comprehensive supply chain management (SCM) system, the company aims to optimize the utilization of its new production facilities and stay ahead of market trends to enhance its competitiveness in the industry.

Approach

By applying the principles of supply chain management (SCM) and implementing an advanced planning and scheduling (APS) system, a chemical manufacturer can significantly increase its profits by promptly responding to real-time changes in product prices. To achieve this, the company must develop a sales strategy centered on high-profit products and focus on efficient supply and inventory management that aligns with this strategy.

To maintain the daily production cycle of products for one month, the company adjusts production volume for each product type and prioritizes the production of high-margin products by linking it with the sales plan. The goal is to formulate and execute a supply/inventory management plan within one hour.

In addition, the use of artificial intelligence (AI) and statistical analysis provides the company with an optimum price range based on various factors that affect fluctuations in selling prices and raw material prices. By providing this price range, the company can determine the optimal selling price and unit purchase price, leading to further increase in profits.

Supporting business strategies tailored to market conditions with product mix simulation

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Return on Investments

By systematizing the entire supply chain management (SCM) plan, including demand forecasting, sales planning, medium- to long-term supply planning, Available-to-Promise (ATP) delivery date answers, and short-term production planning, manual labor is minimized, and information can be accessed quickly and accurately.

The system also incorporates specific requirements for polymer manufacturing, such as implementing a safety inventory policy that takes into account the monthly production cycle and formulating a supply plan based on the Production Wheel. This ensures that the system is tailored to the specific needs of the polymer manufacturing industry.

Adopting a company-wide unified system allows for all Production-Sales-Inventory (PSI) simulations to be performed and establishes a system for rational decision-making of supply and demand. This leads to the maximization of profits by ensuring that the company is always operating at optimal efficiency.

Case Study

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By using AI algorithms and statistics to generate demand forecasts appropriately modeled for product's attributes and market trends, a leading beverage maker minimized temporal stocks-outs and excess inventory.

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By simulating sales targets, inventory replenishment plans, and supply campaigns, a bitotech company has been able to generate a feasible supply plan that will eventually prevent out-of-stocks and product returns.

Sales Plan | Analysis & Report