In inventory optimization, a node refers to a distinct point or location within the supply chain network where inventory is stored, processed, or transferred. Common examples of nodes include manufacturing plants, distribution centers, warehouses, retail outlets, and even supplier facilities. Each node plays a critical role in managing the flow of goods, information, and services across the supply chain. The performance and inventory policies at each node—such as reorder points, safety stock levels, and lead times—directly influence overall supply chain efficiency and customer service levels. From an optimization standpoint, managing inventory across multiple nodes involves strategic decisions on where to hold stock, how much to store, and how frequently to replenish. This requires a holistic view of the supply chain, considering factors like demand variability, transportation costs, service level targets, and inter-node dependencies. Optimizing inventory at each node—and across the entire network—enables businesses to reduce excess inventory, minimize costs, and improve responsiveness, ultimately leading to a more agile and resilient supply chain.
