ICMM Inventory Control and Materials Management Using the data given below please complete the forecasts using the
Question:
ICMM |
Inventory Control and Materials Management |
Using the data given below please complete the forecasts using the following 3 methods
For each calculate the mean absolute deviation (MAD)
What forecast method is best, why?
2 month | |||
Month | Pizzas | Forecast | Absolute value of error |
1 | 230 | ||
2 | 240 | ||
3 | 260 | ||
4 | 320 | ||
5 | 320 | ||
6 | 350 | ||
7 | |||
sum of errors | |||
MAD |
3 month | |||
Month | Pizzas | Forecast | Absolute value of error |
1 | 230 | ||
2 | 240 | ||
3 | 260 | ||
4 | 320 | ||
5 | 320 | ||
6 | 350 | ||
7 | |||
sum of errors | |||
MAD |
2 month weighted moving average | |||||
Month | Pizzas | Forecast | Absolute value of error | weight for most recent period | weight for oldest period |
1 | 230 | 0.8 | 0.2 | ||
2 | 240 | ||||
3 | 260 | ||||
4 | 320 | ||||
5 | 320 | ||||
6 | 350 | ||||
7 | |||||
sum of errors | 0 | ||||
MAD | 0 |
A manufacturer of bicycle parts is looking at the expected demand for all of their seats over the next 6 months. They want to plan out a level production strategy in the charts below
Chart 1
Fill out the inventory production amounts and the inventory levels for each month.
The starting inventory is 300 units.
Month | Starting values | 1 | 2 | 3 | 4 | 5 | 6 | Total | |
Demand | 1000 | 1400 | 1200 | 1300 | 1100 | 900 | 6900 | ||
Production | |||||||||
Inventory | 300 |
Chart 2
In this plan the company wants to see the effects of finishing with an additional 600 units, making the ending inventory 900 units.
Month | Starting values | 1 | 2 | 3 | 4 | 5 | 6 | Total | |
Demand | 1000 | 1400 | 1200 | 1300 | 1100 | 900 | 7500 | ||
Production | |||||||||
Inventory | 300 |
Complete the following tables by calculating the net requirement planned order receipt and planned order release for each week.
Bicycle Assemblies
Lot size to order = 400 units
Lead Time = 1 week
Final Assembly -Bicycles | 1 | 2 | 3 | 4 |
Gross requirements | 100 | 500 | 200 | 100 |
Scheduled receipts | 400 | |||
Projected available 300 | ||||
Net requirements | ||||
Planned order receipt | ||||
Planned order release |
Wheel Assemblies
Lot size to order = 800 units
Lead Time = 1 week
2 Wheel Assemblies per bicycle
Wheel assemblies | 1 | 2 | 3 | 4 |
Gross requirements | ||||
Scheduled receipts | ||||
Projected available 500 | ||||
Net requirements | ||||
Planned order receipt | ||||
Planned order release |
A company has 4000 different items in inventory and wants to use an ABC analysis for cycle counting purposes. They have the following info to help them
20% of the items can be classified as A items and they are to be cycle counted 1 per month
30% of the items can be classified as B items and they are to be cycle counted every 3 months
C items are to be counted twice a year
The company operates 250 workdays per year
Using the chart below calculate the number of counts per day for each item class and the total counts per day
Classification | Number of Items =4000 | Count Frequency per Year | Number of Counts per Year | % of Total Counts | Counts per Day | ||
A | |||||||
B | |||||||
C | |||||||
Total Counts per Year | |||||||
Workdays per Year | |||||||
Counts per Day |
Operations and Supply Chain Management
ISBN: 978-0078024023
14th edition
Authors: F. Robert Jacobs, Richard Chase