RightChain Nodes User Guide

5.8 Incremental Inventory The incremental inventory investment is an estimate of the change in inventory investment required throughout the network as a function of the number of DCs, warehouses, or stocking locations. The total inventory investment is based on the “Inventory Parameters” and the total number of distribution centers. As the number of distribution centers increases, the required amount of safety stock throughout the network increases. RightChain Nodes automatically takes that phenomenon into account when computing the inventory investment required for a given network scenario. In the example, there are three facilities in the baseline network, with a total of $100,000,000 inventory investment. In increasing the number of network facilities from three to four, RightChain Nodes estimates that there will be an additional 7.74% inventory, or $7,740,000.

Baseline Scenario with Three DCs

RightChain Nodes

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