1 Current Inventory Costs are $1,000,000 spread across 16 distribution centers Management is planning to change the number of locations to 25 locations What be the impact on the inventory costs 2 Assume Demand 3000 units year Inventory value $80 unit Order placement cost $400 order Annual carrying costs $0 30 per dollar held yr or 30 If you supplier calls with a special 1X discount of 5 , how much should you buy

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Question: 1. Current Inventory Costs are $1,000,000 spread across 16 distribution centers. Management is planning to change the number of locations to 25 locations. What be

1. Current Inventory Costs are $1,000,000 spread across 16 distribution centers. Management is planning to change the number of locations to 25 locations. What be the impact on the inventory costs?

Assume:

Demand = 3000 units/year Inventory value = $80/unit Order placement cost = $400/order Annual carrying costs = $0.30 per dollar held/yr or 30%

If you supplier calls with a special 1X discount of 5%, how much should you buy?

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