The College of Administration and Economics at the University of Baghdad discussed , a master’s thesis in field of Industrial Management by the student (Dhuha Mohammed Abd AL- Wahid ) and tagged with (The possibility of integrating the ABC matrix and the FSN inventory movement model for inventory management/ an applied study at Al-Sadd Food Industries, Water Bottling and Purification Company ) , Under supervision of (Assist.Prof Dr. Bushra Sabeeh Kadhim )
The research aims to develop an integrated analytical framework for inventory management at Al-Sadd Food Industries Company, employing modern quantitative analysis methodologies and applying an integrative model combining the importance-value (ABC) and the stock movement (FSN) matrices. This model aims to improve inventory management efficiency and reduce waste in financial and operational resources.
The research adopted an analytical and applied approach, based on the company’s actual data for the years 2022–2023–2024. Raw materials were classified according to the ABC analysis to identify the highest-value items with the greatest impact on total cost. These items were then analyzed according to the FSN model to assess their speed of movement and consumption. This resulted in an integrated matrix (ABC–FSN matrix) comprising nine composite categories, enabling the formulation of differentiated purchasing and storage policies based on the item’s importance and movement dynamics.
To support the practical aspect, a simulation model was implemented using Microsoft Excel, relying on the RAND BETWEEN function to generate hypothetical monthly demand values within a specified range, reflecting natural market fluctuations. The Economic Order Quantity (EOQ) and Reorder Point (ROP) models were also used to determine optimal inventory levels and balance ordering and storage costs.
The results showed that combining ABC and FSN analyses with quantitative simulation contributed to reducing logistics costs and improving production service levels by focusing on high-value, fast-moving critical materials. The researcher concluded that implementing this integrated model represents a practical step towards transitioning to modern inventory management, which contributes to increasing the efficiency of purchasing decisions and enhancing the sustainability of production operations in a changing demand environment
