Inventory Management

Efficient inventory management is an important component of enterprises’ green growth model. By reducing the inventory levels and inventory costs and lessening resource waste, enterprises can efficiently achieve green growth. To realize green transformation, enterprises need to form a closed-loop system from product design to resource recovery and utilization and then implement the coordination of “green” and “growth”. Therefore, inventory management and control in a closed-loop system plays an important role in the green growth model and value chain reconstruction. Demand information mutation or the bullwhip effect of the supply chain is one of the important reasons for a high inventory level. It refers to the transmission of the market demand information from the downstream retailer to the upstream supplier throughout the value chain in the course of the fluctuation and variation. The bullwhip effect will cause higher inventory levels and inventory costs for the supplier. And the demand information distortion increases the risk of production and inventory management for upstream suppliers in the value chain and even can lead to the disruption of production and supply. To efficiently achieve the green growth of enterprises through efficient inventory management, this chapter focuses on the impact of the product return, remanufacturing, and different value chain structures on the bullwhip effect and inventory costs based on statistical theory and methods. We analyze the coordinated control measures of the bullwhip effect under different scenarios to lower the inventory levels and inventory costs of the enterprises. The analysis will help enterprises better achieve the green growth model and the green transformation of the value chain.