Selection Strategy for Handling Deadstock Products using the Analytical Hierarchy Process (AHP) and Expected Monetary Value (EMV) Method
Abstract
The accumulation of deadstock on Network Terminal Equipment (NTE) products in the telecommunications company's warehouse has resulted in increased storage costs and financial losses for the Company. This study aims to develop an optimal deadstock-handling selection strategy by integrating the Analytical Hierarchy Process (AHP) and the Expected Monetary Value (EMV). The AHP method is used to determine the weight of the decision criteria (cost, implementation time, and ease of implementation). At the same time, EMV is calculated using a Monte Carlo simulation to evaluate the monetary value of each of eight handling alternatives (re-layout, FIFO strategy, purchase forecast, stock opname, product discount, resale to supplier, sale to Marketplace, and sale with bundling strategy). Data were collected through expert interviews and historical deadstock data from the telecommunications company's warehouse. The analysis shows that the AHP-EMV combination can recommend the best strategy by considering both financial and non-financial factors. The EMV simulation revealed that sales with a bundling strategy provide the highest monetary value of IDR. 288,572,250 compared to other alternatives. This research offers practical contributions in the form of a data-based decision-making framework for deadstock management and policy recommendations for internet service providers.
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