Modern Perspectives of Purchasing Management $($Purchasing Management$)$

Read the statement below and answer all three questions that follow:

UNCLE JOO DELICIOUS CHICKEN $($UJDC$),$ a leading restaurant in Durban, South Africa, faces numerous challenges, including overstocking, stockouts, and inefficient order management. Traditional inventory management methods may lead to excess inventory holding costs or missed sales opportunities. To address inventory challenges, UNCLE JOO implemented Economic Order Quantity $($OEQ$)$ principles. EOQ helps determine the optimal order quantity that minimizes total inventory costs, considering factors like carrying costs, ordering costs, and demand variability. By calculating EOQ for each product SKU $($Stock Keeping Unit$),$ the retailer can ensure optimal inventory levels while minimizing costs. In addition to EOQ, the retailer leverages IST solutions to enhance inventory management efficiency.

You are employed by UNCLE JOO as a Supply Chain Manager to assist in exploring how leveraging EOQ principles alongside IST solutions can address these challenges and drive sustainable growth. Answer the following two questions based on the above statement:

QUESTION $1[20$ MARKS$]$

The annual demand of fresh chicken $($boxes of $6$ kgs$)=750$ units, delivered purchase cost $=$ R$35/$units$,$ Annual carrying cost percentage$=25$ percent, Order cost $=$ R$50/$order$.$ The lead time is $10$ working days. Assuming $20$ working days per month.

$1\mathrm{.}1$ Determine the Economic Order Quantity. Discuss the results using MALUME$$s restaurant. $(4)$

$1\mathrm{.}2$ Determine the reorder point. Discuss the results using MALUME$$s restaurant. $(4)$

$1\mathrm{.}3$ Determine the average inventory. Discuss the results using MALUME$$s restaurant. $(4)$

$1\mathrm{.}4$ Suppose orders are placed only at review time. Find the optimal period and the optimal order quantity. Discuss the results using MALUME$$s restaurant. $(8)$

QUESTION $2[10$ MARKS$]$

Use relevant literature and analyse any five benefits of Information Systems Technology to the above retailer. Use practical examples using MALUME$$s restaurant to support your answer.