Component # Description Component Cost LT Qualified Supplier 800-23475-01 Integrated Circuit $10 16 weeks TI 800-56891-02 Capacitor $5 10 weeks NWE 800-97845-01 DRAM $20 12 weeks Samsung Problem 1: The lead-time of an integrated services router is 4 weeks (time from customer order to shipment from CISCO). The product BOM has 100+ components. Standard cost of the BOM is $100. Below is the list of unique components with LT > 8 weeks and with only one qualified supplier. Marketing and Sales provided their best estimate of demand during the consensus forecast meeting (1000 units per quarter) but they foresee a risk of 50% upside to their numbers. This is an important product and its successful launch is very critical to regain lost market share from Huawei.

Component #	Description	Component Cost	LT	Qualified Supplier
800-23475-01	Integrated Circuit	$10	16 Weeks	TI
800-56891-02	Capacitor	$5	10 Weeks	NWE
800-97845-01	DRAM	$20	12 Weeks	Samsung

1. What will be the cost if team decides to have SI (strategic inventory) at the FG level to cover upside risk of 50% over the quarter? 2. What will be the inventory cost if team decides to have SI only for the single source components with LT > 8 weeks. 3. What will be your recommendation to the marketing/sales team in terms of placing component SI or FG SI if all components (except the above three components) have LT <= 6 weeks. And why?