In order to overcome uncertainty situation and inability to meet with customers' demand due to uncertainty, the organizations tend to keep a certain safety stock level. In this paper, the researcher used soft computing to identify optimal safety stock level (SSL), the fuzzy model uses dynamic concept to cope with high complexity environment status and control the inventory. The proposed approach deals with demand stability level, raw material availability level, and on hand inventory level by using fuzzy logic to obtain SSL. In this approach, demand stability, raw material, and on hand inventory are described linguistically and treated by inference rules of fuzzy model to extract best level of safety stock. The numerical dairy industry case study was applied with yogurt 200 gm cup product.
Keywords: Inventory optimization, soft computing, safety stock optimization, dairy industries, inventory optimization.