Supply Chain Management

During the game, I realized that wide gaps in orders of every role in the supply chain such as factory, distributor and retailer create inventory management challenges. For example, distributor records 0units between week1-week 4 compared to retailer within the same period. The retailer records 3units, 5units, 2units and 2units between weeks 1- week 4. The same applies to factory with 0units from weeks 2-4. Addressing inventory management problems requires developing an average unit level to avoid disappointing customers when demand

The explanation for the answer to the given question is as follows: Hence, the current stock available is 180 units. To find out the probability of the company running out of the stock of 180 units within a time of next 3 weeks, let’s take ' z ' as a value that should be checked in the standard deviation table in order to find the probability...

4. Assume that Davidson has reviewed its inventory classifications, and that this item has been reclassified “B” and that it now managed by periodic review. Review occurs once per quarter. With a 90 percent cycle-service level, the proper order

There is Change in the Carrying costs, total inventory cost, reorder point while the Ordering costs and the economic order quantity do not change if the firm does not hold the safety stock.

Hello and welcome to our review of the Amazing Stockpiling Challenge by Dan F. Sullivan.

After finding out the standard deviation of demand in 2010, the Z value and the lead time were also given in the case. On SG’s proposed policy revision, the company’s target service level is 99%, which translated to a Z value of 2.33 (pg 7). Finally, the average lead time after warehouses placed an order with manufacturing facility is approximately 5 days (pg 6). Combining the standard deviation of demand, the Z value, and lead time, the safety stock level for 2010 was calculated (SS Costs).

2) Current inventory level – Every few days, Mr. Watkins performs a detailed analysis of inventory. He looks for trend that could establish larger-volume buying or reduction in inventory that the MRP action report would not recommend. There are times when volume discounts apply and he consults with the CFO of SSC to determine what the most profitable alternative is for SSC. The decisions are always made by Mr. Watkins and the CFO.

Lead time varies significantly, which affects the inventory cycle. The plant has to set a safety stock that will protect the production against stock outs, vehicle breakdowns, weather related delays and the shortage of supply from farmers and hogs barns.

In an effort to ensure consistent in-stock on key items the merchant teams need your support in managing inventory on key drop ship items for Walmart.com. As part of this process we're requesting that you hold & maintain an inventory feed of 12 weeks of supply on top sellers. Please see an attachment for the list of your top selling SKUs. This quantity has been identified by item and noted as a "safety stock required" in column XX of the attachment.

In the calculation of average inventory levels, a desired service level of 99% and a review period of 14 days with a lead time of 5 days were used to calculate the safety stocks and order-up-to-levels for each product under each circumstance. Then the amounts of overstock units were obtained by calculating the differences between OULs and average demands, and the overstock inventories were the overstock units multiplied by the unit cost. The annual average inventory levels were calculated to be $31,560.75 for the eight warehouses option, $14,120.28 for the two warehouses option and $9,403.24 for the one centralized warehouse option. As for the outsourcing option, the responsibility of inventory management would fall upon GL, so that there would be no inventories for SG.

Variable order cycle – lead time from placement to receiving of the order = 4 days.

We began our analysis by searching for bottlenecks that existed in the current system. It was easily identified that major issues existed in the ordering process. Without calculations, you could tell the reorder point was too low since the historical plots showed inventory levels at zero for two or more days at a time. The number of jobs in customer orders showed correlating spikes at the same time of the inventory outages. We reviewed the utilization and queues of the other stations in the system but were hesitant to make in immediate changes since we were not entirely certain the effects of correcting the inventory policy.

So we calculated the TIL (Target Inventory Level) – 821 kits and reorder quantity – 713 kits with Z, 98% probability of not stocking out during the period, according to periodic review system method for last 52 days. After making last order we reset the reorder quantity and reorder point both to ‘0’ not to make anymore orders.

As in part one of the Supply Chain Game, we were given the option to use trucks as a shipping method. This method can make or break your bottom line because it is an expensive option if you are not utilizing it properly. The cost of using this shipping method is still $15,000 whether the truck is in full or partial methods. The importance of running this part of the operation to perfection is in the numbers. A truck that leaves at half capacity (100 drums) is only generating $145,000 on that run, whereas a full truck would yield

A central focus of McDonald’s, much like in any retailer, is Inventory Planning and Control. An advantage McDonald’s and other fast food restaurants have in Inventory Planning and Control is that the vast majority of their stock can be either be frozen (pre-prepared burger patties, chicken products, French fries) or can lost an almost indefinite period without deterioration (Boxes for serving menu items such as French fries or Happy Meals).8 However, Inventory Planning and Control is still something branches of McDonald’s must pay keen attention to in order to attain or maintain the desired level of customer service quality (known as quality management). Buffer or safety inventories (extra amounts of stock which are kept in preparation for unexpected fluctuations in supply and demand) are kept at all times to ensure that customers can be served their desired menu items regardless of increased demand.8 In addition to this, in times of extremely high unexpected demand different branches often