Inventory Management

When looking at the car rental industry, it is safe to say that managing inventory is very imperative and leads the company into the direction they plan on heading. Making sure that there are always cars on the lot is a main concern Enterprise deals with when it comes to inventory management. The goal is to always have the vehicle of choice available of the respective customer, at the exact time they need it.

Enterprise Rent-A-Car also tries to ensure the right amount of inventory available by having multiple contracts with manufacturers which include major makes and models from Chrysler, GM, Ford, Nissan, Toyota Mazda, Kia, Volkswagen, and Hyundai. Enterprise has more contracts with manufacturers than any other rental car company. These dealers distribute cars to their branches, but most times it is still not enough. It is not uncommon for Enterprise branches to run out of vehicles in their own lots, ultimately resulting in them being incapable to rent to customers.

Using inventory management safety stock method would reduce the number of inventory uncertainty and unsatisfied customers. The main objection of safety stock inventory is to make sure there will be enough inventory available for demand at the given time. From learning about the Bordentown branch, we were able to learn that times of the year where vacations are in high volume, there is a higher demand in cars needed to be rented. During these times, the branch can be prone to missing a few cars on the lot due to random mishaps that can lead to another customer being unsatisfied with their service. Safety stock inventory will allow the branch to be a step of the game by providing more vehicles during these times. This will prepare the company for days where the demand for vehicles are high and you will be able to efficiently deliver the needs to each customer.

For example, In June there is a high demand for SUV vehicles. During this time, in case if there is a day where there are reservations for about 6 SUVs, the branch will still be able to deliver. Since the Bordentown Enterprise branch receives their inventory from other vehicle manufacturers and other branches, ordering more SUVs than usual would be ideal so that customers will receive their vehicle of choice at the time they need it. The last thing Enterprise would want is to have a customer make a reservation for a vehicle, and it is not available when they arrive at the branch. To prevent this, practicing safety stock will reduce that uncertainty.