  With information revolution, increased globalization and competition, supply
chain has become longer and more complicated than ever before. These
developments bring supply chain management to the forefront of the managements
attention. Inventories are very important in a supply chain. The total
investment in inventories is enormous, and the management of inventory is
crucial to avoid shortages or delivery delays for the customers and serious
drain on a companys financial resources. The supply chain cost increases
because of the influence of lead times for supplying the stocks as well as the
raw materials. Practically, the lead times will not be same through out all the
periods. Maintaining abundant stocks in order to avoid the impact of high lead
time increases the holding cost. Similarly, maintaining fewer stocks because of
ballpark lead time may lead to shortage of stocks. This also happens in the
case of lead time involved in supplying raw materials. A better optimization
methodology that utilizes the Particle Swarm Optimization algorithm, one of the
best optimization algorithms, is proposed to overcome the impasse in
maintaining the optimal stock levels in each member of the supply chain. Taking
into account the stock levels thus obtained from the proposed methodology, an
appropriate stock levels to be maintained in the approaching periods that will
minimize the supply chain inventory cost can be arrived at.
