Assume that you are a producing manager of an office chair manufacturer. Your company purchase raw material
Question:
Assume that you are a producing manager of an office chair manufacturer. Your company purchase raw material and customize office chair for the following three countries: Japan, Taiwan, and South Korea. The chairs produced for each country is customized and labeled with the trademark of the client. Thus, no cross-sale is allowed. The order quantity from each country are summarized on the table below. The unsold product will be salvaged in the end of the year.
Country | Max | Min |
Japan | 1000 | 500 |
Taiwan | 800 | 300 |
Korea | 500 | 300 |
Assume that the cost of raw material is NT$ 50, the sales price is NT$ 1,000 and the unsold finish product is salvaged with cost of NT$ 3. Please answer the following question:
What is your optimal production quantity for every country?
Assume that your company is starting a joint venture with a local retailer. The retailer estimates its annual demand to be normally distributed with mean 1,000 and standard deviation equals to 50. In addition, the transportation lead-time is two weeks. Also, assume that the retailer operates 250 days per year, 5 days per week and the cycle service level is 90%. Interest rate is 6% and ordering cost equals $50. Answer the following questions:
Under periodic review inventory system, what is the (i) review period; (ii) safety stock; (iii) target inventory level?
Under continuous review inventory system, what is the (i) safety stock; (ii) reorder point
Please construct an excel which can calculate the answers in (b). Also, please use that excel to compare the answer of safety stock for customer’s service level 95%, 90%, 85% and 80% with both periodic and continuous review system.
University Physics with Modern Physics
ISBN: 978-0321696861
13th edition
Authors: Hugh D. Young, Roger A. Freedman, A. Lewis Ford