Assessment and Evaluation of Safety Stock Procedures: A Case Study at Galderma

Sammanfattning

Logistics is about ensuring the right materials are available at the right price and at the right time. To succeed, companies must actively manage various disruptions in the supply chain, such as unexpected demand and delivery delays, which can lead to shortages and dissatisfied customers. One effective way to handle these uncertainties is through the use of safety stock, which creates a buffer to keep operations running smoothly. This study focuses on Galderma, a pharmaceutical company with production in Uppsala, which has identified the need to map, evaluate and improve its current approach to safety stock implementation. The work centers around the company’s material supply, specifically how safety stock levels should be determined for each component stored in the raw material warehouse. Appropriate safety stock levels were calculated for selected components considering different service levels and lead times, in order to illustrate how safety stock levels are affected under various scenarios. The study also presents two different classification methods to segment components, supporting tailored inventory management strategies that effectively meet the needs of each component. New reorder points were also calculated to provide Galderma with clearer guidance on suitable thresholds for selected components. The results show mixed outcomes, with some suggested safety stock levels being higher and others lower than the current levels. This indicates that Galderma may currently have both over- and understocked safety inventories, leading to risks of waste and write-offs on one hand, and potential shortages that could impact production on the other. Finally, several improvements concerning procedures for implementing safety stocks were proposed. These include, among other aspects, defining service levels based on item classification, increasing the use of quantitative calculation methods, gathering more reliable information regarding supplier delivery reliability, and adapting inventory management methods for each component group.