Question: A manufacturer purchases three components ( A , B , C ) from three different suppliers. The annual demand and cost of components are as
A manufacturer purchases three components A B C from three different suppliers. The annual demand and cost of components are as follows:
Component
Annual Demand
Cost
A
$
B
$
C
$
Annual hong cost is of the cost of component. Ordering cost is mainly transport and it is $ pickup. Right now, the three components are ordered according to their economic order quantity and the pickups are separate for each component at $ a run. The pickup logistics person says they can pickup components from B and C when the pickup and will charge additional $ for each stop, instead of paying separate $ for each pickup. That is they will first load component A from supplier A then load component from supplier B and then stop at C to pickup component C in the same run. The total cost $$$ $ Will you take up the deal based on cost How does holding and ordering cost change for B and C
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