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Supply Chain Management Problems

In: Business and Management

Submitted By ariavince
Words 790
Pages 4
10-2 Ashton Furniture Company Raw Materials | Oak | $ 48,000 | | Pine | 18,000 | | Brass Fixtures | 9,600 | | Stains | 6,000 | | Joiners | 900 | Work in Process | Frames | 6,000 | | Drawers | 4,000 | | Panels | 30,000 | | Chests | 13,200 | | Tables | 8,100 | Finished Goods | Chests | 150,000 | | Coffee Tables | 70,000 | Total | | 363,800 |

Inventory turns = 3,700,000/363,800 = 10.2
Days of supply
-------------------------------------------------
363,800
(3,700,000)/(365)
= 35.9

10-6 Delph Manufacturing Company
Supplier 1 Raw Materials | $ 275,000 | Work in Process | 62,000 | Finished Goods | 33,000 | Total | 370,000 |

Inventory turns = 8,360,000/370,000 = 22.6
Weeks of supply
-------------------------------------------------
370,000
(8,360,000)/(52)
= 2.3 weeks

Supplier 2 Raw Materials | $ 870,000 | Work in Process | 550,000 | Finished Goods | 180,000 | Total | 1,600,000 |

Inventory turns = 14,800,000/1,600,000 = 9.3
Weeks of supply
-------------------------------------------------
1,600,000
(14,800,000)/(52)
= 5.6 weeks
Supplier 1 has the best supply chain performance according to inventory turns and weeks of supply. The company might also consider different suppliers SCORcards and/or metrics in comparison with one another.

11-14
“For some manufacturing companies, transportation costs can be as much as 20% of total production costs and run as high as 6% of revenue. For some retail companies primarily involved in the distribution of goods, like L.L. Bean and Amazon.com, transportation is not only a major cost of doing business, it is also a major determinant of prompt delivery service. L.L Bean ships almost 16 million packages in a year” (Russell & Taylor, 2011, p 460). I think that both…...

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