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Case Study Article

Classification of products based on the uncertainty of supply chain demand: a case study of wineries in Chile

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  • Armando Camino,
  • Juan Pablo Vargas
Armando Camino
Universidad de Lleida
Juan Pablo Vargas
Universidad de Santiago de Chile
DOI: https://doi.org/10.36253/wep-15086

Published 2025-05-20

Keywords

  • demand uncertainty,
  • supply chain,
  • production and inventory management,
  • product classification,
  • wine industry

How to Cite

Camino, A., & Vargas, J. P. (2025). Classification of products based on the uncertainty of supply chain demand: a case study of wineries in Chile. Wine Economics and Policy. https://doi.org/10.36253/wep-15086

Copyright (c) 2024 Armando Camino, Juan Pablo Vargas

Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License.

Abstract

Supply chains face increased uncertainty, which must be taken into account in tactical and operational decisions. However, there is a gap between the models proposed in research and actual practice. The objective of this research is to contribute to closing this gap by providing findings on product classification based on the measurement of supply chain uncertainty. Our research presents a case study of three wineries in Chile. The empirical methods of product classification used by the company are reviewed. A quantitative method is applied to measure the uncertainty of the demand of finished products, which enables classifying the products, and the performance of the methods is analyzed in comparison with the ABC classification of products for the purpose of integration with inventory management. The quantitative ABC method is the most widely used. However, failure to incorporate demand uncertainty as a criterion can lead to poor inventory management decisions. The method based on demand uncertainty is more effective in product classification and supply chain operational and tactical decisions. The novelty lies in the application of a quantitative method based on demand behavior that classifies products in a useful way for a comprehensive production and inventory management model. This article opens the door to future research to replicate this methodology in other industries with real cases to close the gap between theory and practice.

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