Application of Distribution Requirement Planning in Optimizing Packaged Drinking Water Distribution to Mitigate Lost Sales
Abstract
The bottled water industry in Indonesia has experienced a positive growth trend due to increasing public awareness of the importance of hydration and a healthy lifestyle. However, DC Formula Paluta in Padang Lawas Utara, North Sumatra, faced a lost-sales challenge of 7% in 2023, exceeding the typical tolerance level in the FMCG industry, which ranges from 3–5%. The purpose of this study is to identify the causes of lost sales and propose solutions through demand forecasting, determining the optimal order quantity, and planning a more efficient distribution using the DRP Worksheet and fishbone diagram. Historical data analysis from January to December 2023 using Pom QM software shows that the Regression/Trend Analysis and Multiplicative Decomposition methods have the lowest Mean Absolute Deviation (MAD) values. Therefore, these two methods were selected for forecasting the demand for gallon, bottle, and cup products in the coming year. The implementation of the Economic Order Quantity (EOQ) method successfully reduced the ordering frequency from 190 times to 124 times per year, saving costs from IDR 147,440,000 to IDR 96,224,000, or approximately 35%. The application of Distribution Requirement Planning (DRP) improved the efficiency of distribution planning and inventory management, ensuring product availability according to market demand. The combination of forecasting methods, EOQ, DRP, and fishbone diagram analysis is expected to reduce mismatches between inventory and demand, improve operational and distribution management efficiency, and directly lower the level of lost sales occurring at DC Formula Paluta.
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