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Thus, Replenishment is driven by actual consumption, not sales forecasts.As sales are made, the buffer levels at retail locations drop, eventuallytriggering Replenishment from a regional warehouse. Similarly, asbuffer levels at regional warehouses drop, this eventually triggersReplenishment from the factory warehouse. The buffer zones at the factorywarehouse are set, however, so that they trigger a manufacturingorder that should resupply this buffer before it runs out.Buffer sizing is based on both variability and time to resupply. Thatis, the more variable consumption is, the bigger the buffer must be tocover that variability. Likewise, the longer it takes to resupply, the biggerthe buffer must be to cover demand during the wait. Therefore, asaggregation reduces variability and DBR reduces resupply time, therequired buffer size decreases accordingly.In addition to being used subsequent to DBR, Replenishment can becombined with DBR. That is, the Replenishment techniques that workin an external distribution chain can also be used internally within a
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