You are the logistics manager for an electronics manufacturer HQ’d in the United States. A new upper management has come into power.

You are the logistics manager for an electronics manufacturer HQ’d in the United States. A new upper management has come into power, and they are heavily focusing on the company’s financial performance. One of their prime targets is the company’s inventory levels globally. You have been assigned the task of looking at the company’s inventory levels and making suggestions to improve performance. The director of Logistics has given you the following data set. Your job is to evaluate the following 20 SKU’s and their demand patterns over the last three years.

Calculate the bulleted points below, and Assume Ordering costs and holding costs are the same for all SKU’s.

3 period Moving average Forecast for 2014
Reorder Point
EOQ
Maximum Inventory Level
Minimum Inventory Level
Cost of Excess AND Cost of Shortage
Ordering Cost=$50
Holding Cost=2.5

Once this has been done, the director will ask you to classify each part as A,B or C.

SKU	Cost	Sale Price	2013 Demand	2012 Demand	2011 Demand	Dollar Usage	%Total Dollar Usage	Annual Holding Cost per Unit	Lead Time (days)
Item 1	0.2	0.6	1500	1450	1350				10
Item 2	20	60	3	32	23				10
Item 3	55	165	50	70	65				10
Item 4	1300	3900	20	15	12				30
Item 5	245	735	100	140	200				10
Item 6	75	225	70	75	90				10
Item 7	10000	30000	12	6	4				90
Item 8	345	1035	500	600	900				60
Item 9	211	633	39	23	45				45
Item 10	0.45	1.35	3450	3000	5000				10
Item 11	8	24	3000	2300	3400				10
Item 12	10.5	31.5	450	750	650				10
Item 13	0.5	1.5	5000	10000	3300				10
Item 14	155	465	150	120	100				10
Item 15	1.32	3.96	4000	3000	1500				10
Item 16	13.6	40.8	2300	4000	3000				10
Item 17	3000	9000	120	90	110				90
Item 18	1.25	3.75	4500	4000	3300				10
Item 19	540	1620	90	80	20				30
Item 20	750	2250	300	200	500				30

2) Pam runs a mail order business for gym equipment. Annual demand for the TricorFlexers is $16000. The annual holding costs per unit is $2.50 and the order costs are $50. What is the EOQ?

3) Using the same holding and ordering costs as above, suppose demand for the TriFlexors doubles to 32000. Does the EOQ double as well?

4) Quizno’s sells large tins of Tom Tucker’s Toffee. The deli uses a periodic review system checking inventory every 10 days, at which time an order is placed for more tins. Lead time is 3 days. Average daily demand is 7 tins, so average demand during the reorder period and lead time (13 days) is 91 tins. The standard deviation of demand during this same 13 days is 17 tins. Calculate the restocking level

5) If your company has demand of 50,000 units per year and a supplier lead time for replenishment is 10 days. At what reorder point would you need to trigger another order?

6) TriCor Company manufactures a fitness product. The following data is collected for the previous year. Calculate the Reorder quantity, reorder level, maximum level of inventory and minimum level of inventory using the data below.

Monthly Demand: 10,000
Order Costs:$50
Normal Usage: 500 units per week
Max Usage: 750 units per week
Min Usage: 250 units per week
Reorder Period: 4-6 weeks

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You are the logistics manager for an electronics manufacturer HQ’d in the United States. A new upper management has come into power.

Spirituality Academic Essay

Part B: 30 Marks ( Due date: 5:00pm Friday 2nd September 2016)

You are the logistics manager for an electronics manufacturer HQ’d in the United States. A new upper management has come into power.

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