Analysis and modelling of stock induced consumption phenomenon and its impact on wastage of resources

Abstract

newlineSociety has over time, and particularly during the last decades, developed towards a consumer society. The increase in consumption has also led to an increase in waste and as a result, an increased interest in waste management. This study provides a new insight into the stock-induced consumption phenomenon which was yet confined to the inventory management practices only. This study examines the vast applicability of the phenomenon in our day-to-day life and focuses to analyse and model the resource wastage that is taking place due to stock-induced consumption phenomenon. newlineIn this study firstly, a number of inventory control models considering demand as stock-dependent are analysed and the research opportunities are identified through an extensive literature review. Then a questionnaire is administered to identify and categorize a number of consumable items on the basis of their potential for stock-induced consumption and estimation of stock-induced consumption index was done for a number of critical commodities. Then moving towards the analysis of stock-induced wastage of water resource, a case study analysis approach is adopted to analyse the water resource wastage that is taking place due to the use of big storage tanks at individual household level in India and the analysis reveals that a positive correlation exists between stock keeping of water and its wasteful consumption. Just-In-Time water supply system is suggested which can reduce the uncertainty associated with water distribution system hence eliminating the need for individual stock keeping, resulting in significant reduction in stock-induced water waste. To analyse the stock-induced food resource wastage, a questionnaire analysis is done using Statistical Package for the Social Sciences (SPSS) to investigate consumer s perception about the stock-induced food waste in Indian weddings and to find out their preference for mitigation alternatives. Then a system dynamics model is developed using SD software STELLA (version 9.1.3) to assess the amount of stock-induced food waste generated in Indian weddings. The impact of various factors on this waste is analysed and estimation is made about the financial implications of this waste. The analysis reveals that behavioural factors are the most important factors for stock-induced food wastage in Indian weddings which can be controlled by exercising self and enforced behavioural control measures. Then a controlled condition experiment is conducted on two consumable products from FMCG category- toothpaste and shampoo to find out the impact of product and package design features on stock-induced material consumption. The analysis reveals that big orifice size in tubed and bottled products enhances the consumption rate over the normal consumption resulting in material waste. The research suggests the need for standardization of orifice size and product viscosity to minimize the material waste in such products. The stock-induced consumption equations which are obtained through the previous analyses of water consumption, food consumption and toothpaste consumption cases provide us with stock-induced consumption scale and shape parameters for these items which are then used to analyse the behavioural impact on stock-induced material cost and material waste by drawing indifference curves using Matlab software. The analysis gives a new insight into the behavioural aspects of stock-induced consumption and propounds a new philosophy in inventory management i.e. behavioural inventory management which has a potential to develop into a useful body of knowledge. newlineIn this study a utilitarian approach has attempted to coerce an explicit socio-economic manifestation of the stock-induced consumption phenomenon with an aim to facilitate policy makers to proactively plan for effective inventory management newline