Improving Inventory Management to Prevent Stockout and Overstock: A Case Study Esa Frozen Ramen

Abstract

Abstract - This study examines inventory management challenges at Esa Frozen Ramen, a local frozen food MSME, focusing on stockout and overstock problems. Between May 2024 and June 2025, Esa experienced more than 120 stockouts and 16 units of unsellable overstock, causing losses exceeding Rp4,500,000. The root causes were the absence of structured inventory planning and lack of data-driven forecasting. Using weekly historical demand data (54 weeks), the research compared three time series forecasting methods: Simple Moving Average (SMA), Weighted Moving Average (WMA), and Single Exponential Smoothing (SES), with WMA (0.1, 0.9) achieving the best accuracy (MAD = 1.49, MSE = 6.43, MAPE = 9%). The selected model was used retrospectively to calculate Economic Order Quantity (EOQ), Safety Stock, and Reorder Point (ROP), yielding optimal values of 33 units, 2 units, and 8 units respectively. This integrated approach offers Esa a practical and low-cost strategy to minimize inventory risks, improve product availability, and enhance operational efficiency

Keywords - Inventory Management, Frozen Food, Demand Forecasting, Economic Order Quantity, Safety Stock, Reorder Point