From 1916 to 1966, Studebaker automobiles were manufactured in South Bend Indiana. Vicky Roberts became owner of Roberts’s Auto Sales and Service (RASAS) when she inherited a Studebaker dealership. RASAS is a diversified business that includes three sales and service car dealerships, two auto parts stores, a large body shop, a car painting business and an auto salvage yard. Ms. Roberts is considering expanding the business to include vintage car restoration. She has just acquired a 1963 Avanti Studebaker. She would like to restore the car to mint condition and use the car as advertising for the new business in an upcoming Studebaker meet. The meet is in 45 days. Roberts has a total…show more content… The business of restoration would be on a project basis. RASAS would initiate the process of restoration only on request. The proposed car restorations can be divided into three categories. Basic restorations involve getting the car up and running while a mint condition restoration transforms the car to its original form. A customized restoration includes anything that goes beyond the original form. RASAS envisions working with customers to achieve any kind of restoration they choose. RASAS will also work with customers to provide or acquire parts needed for do-it-yourself restorations. (Ritzman et al, 2007).
As RASAS is required to procure parts for restoration, these parts could be ordered in bulk, stocked-up and used to sell to customers who only require parts. A benefit of holding inventory is that it could help reduce time for procurement of parts. However, this aspect has to be checked in-terms of the amount of inventory RASAS is capable of holding.
The cost and time factor analysis would purely depend on the nature of the project. It could vary from just a basic restoration to mint condition restoration.
RASAS’s parts manager, body shop manager, and chief mechanic have provided estimates of the time and cost associated with the activities required for the mint condition restoration of the Avanti. Figures 1 and 2 (Appendix) summarize the activities, time estimates and precedent relationships.