This document contains 4 summaries of inventory management strategies for different scenarios:
1. Inventory and backorder strategy shows demand forecasts and production levels each month. It tracks beginning and ending inventory levels as well as associated carrying costs and backorder costs. The total annual cost is calculated.
2. A subcontracting strategy tracks the same monthly metrics and adds subcontracting costs when production cannot meet demand.
3. A chase strategy uses hiring and firing to adjust the workforce based on demand. It shows the number of workers needed and hired/fired each month and calculates the associated costs.
4. The final strategy uses overtime and tracks idle time when production capacity exceeds demand. It calculates regular payrolls costs and
This document contains 4 summaries of inventory management strategies for different scenarios:
1. Inventory and backorder strategy shows demand forecasts and production levels each month. It tracks beginning and ending inventory levels as well as associated carrying costs and backorder costs. The total annual cost is calculated.
2. A subcontracting strategy tracks the same monthly metrics and adds subcontracting costs when production cannot meet demand.
3. A chase strategy uses hiring and firing to adjust the workforce based on demand. It shows the number of workers needed and hired/fired each month and calculates the associated costs.
4. The final strategy uses overtime and tracks idle time when production capacity exceeds demand. It calculates regular payrolls costs and
This document contains 4 summaries of inventory management strategies for different scenarios:
1. Inventory and backorder strategy shows demand forecasts and production levels each month. It tracks beginning and ending inventory levels as well as associated carrying costs and backorder costs. The total annual cost is calculated.
2. A subcontracting strategy tracks the same monthly metrics and adds subcontracting costs when production cannot meet demand.
3. A chase strategy uses hiring and firing to adjust the workforce based on demand. It shows the number of workers needed and hired/fired each month and calculates the associated costs.
4. The final strategy uses overtime and tracks idle time when production capacity exceeds demand. It calculates regular payrolls costs and
Month JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC Demand Forecast 100 150 250 400 250 50 90 160 260 390 240 60 Production 200 200 200 200 200 200 200 200 200 200 200 200 Beginning Inventory 0 100 150 100 -100 -150 0 110 150 90 -100 -140 Ending Inventory 100 150 100 -100 -150 0 110 150 90 -100 -140 0 Carryng Cost Backorder Cost 9800 Regular Labor Cost 200000 200000 Overtime Cost
Total Inventory Carryng Cost 0
Total Backorder Cost 9800 Total Hiring cost Total Firing Cost Total Reguler Payroll Cost 400000 Total Overtime Payroll Cost Total Annual Cost 409800 2. Subcontract Month JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC Demand Forecast 100 150 250 400 250 50 90 160 260 390 240 60 Production 200 200 200 200 200 200 200 200 200 200 Beginning Inventory 0 100 150 100 -100 -150 0 110 -100 -140 Ending Inventory 100 -100 -150 0 110 150 -140 0 Carryng Cost 3000 3300 4500 2700 Subcontract Cost 3000 4500 3000 4200 Regular Labor Cost 200000 200000 200000 200000 200000 200000 200000 200000 200000 Overtime Cost
Total Inventory Carryng Cost 21000
Total Subcontract Cost 14700 Total Hiring cost Total Firing Cost Total Reguler Payroll Cost 1800000 Total Overtime Payroll Cost Total Annual Cost 1835700 3. CHASE STRATEGY WITH HIRING AND FIRING Month JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC Demand Forecast 100 150 250 400 250 50 90 160 260 390 240 60 Worker needed 10 15 25 40 25 5 9 16 26 39 24 6 Number Hired 5 10 15 4 7 10 13 Number fired 10 15 20 15 18 Hiring Cost 2500 5000 7500 6500 Firing Cost 6000 8000 6000 7200 Labor Cost 150000 250000 400000 160000 260000 390000 240000 60000 Overtime Cost
Total Inventory Carrying Cost: 0
Total Backorder Cost: 0 Total Hiring Cost 21500 Total Firing Cost 27200 Total Regular Payroll Cost: 2400000 Total Overtime Payroll Cost: Total Annual Cost: 2448700
4. CHASE STRATEGY WITH OVERTIME AND IDLE TIME
Month JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC Demand Forecast 100 150 250 400 250 50 90 160 260 390 240 60 Capacity 20 20 20 20 20 20 20 20 20 20 20 20 Capacity needed 10 15 25 39 24 6 Overtime 5 19 4 Idle Time 10 5 15 11 4 14 Reguler Labor Cost 200000 200000 200000 200000 Overtime Cost 125000
Total Inventory Carrying Cost:
Total Backorder Cost: Total Hiring Cost Total Firing Cost Total Regular Payroll Cost: 800000 Total Overtime Payroll Cost: 125000 Total Annual Cost: 925000
2. Inventory And Backorder
Month JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC Demand Forecast 150 140 200 160 60 400 300 330 200 260 160 40 Production 200 200 200 200 200 200 200 Beginning Inventory 110 110 150 340 Ending Inventory 140 Carryng Cost 1500 3300 3300 4500 10200 4200 1200 1200 Backorder Cost 6300 7700 Regular Labor Cost 20000 20000 20000 20000 20000 20000 Overtime Cost
Total Inventory Carryng Cost 29400
Total Backorder Cost 14000 Total Hiring cost Total Firing Cost Total Reguler Payroll Cost 120000 Total Overtime Payroll Cost Total Annual Cost 163400 Subcontrac Month JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC Demand Forecast 150 140 200 160 60 400 300 330 200 260 160 40 Production 200 200 200 200 200 Beginning Inventory 0 50 110 110 150 340 140 40 -90 -110 0 40 Ending Inventory 50 110 110 150 340 140 40 -90 -110 0 40 0 Carryng Cost 4500 10200 4200 1200 1200 Subcontract Cost 1800 2200 Regular Labor Cost 20000 20000 20000 20000 20000 20000 20000 Overtime Cost
Total Inventory Carryng Cost 29400
Total Subcontract Cost 4000 Total Hiring cost Total Firing Cost Total Reguler Payroll Cost 240000 Total Overtime Payroll Cost Total Annual Cost 273400
CHASE STRATEGY WITH HIRING AND FIRING
Month JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC Demand Forecast 150 140 200 160 60 400 300 330 200 260 160 40 Worker needed 15 14 20 16 6 26 16 4 Number Hired 6 34 3 6 Number fired 15 1 4 10 10 13 10 12 Hiring Cost 1200 6800 600 1200 Firing Cost 1500 1000 1200 Labor Cost 15000 16000 4000
Total Inventory Carrying
Cost: Total Backorder Cost: Total Hiring Cost 9800 Total Firing Cost 3700 Total Regular Payroll Cost: 35000 Total Overtime Payroll Cost: Total Annual Cost: 48500
CHASE STRATEGY WITH OVERTIME AND IDLE TIME
Month JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC Demand Forecast 150 140 200 160 60 400 300 330 200 260 160 40 Capacity 20 20 20 20 20 20 Capacity needed 15 14 20 26 16 4 Overtime 20 10 13 6 Idle Time 5 14 0 4 16 Reguler Labor Cost 20000 20000 20000 20000 Overtime Cost 30000 15000 19500 9000
Total Inventory Carrying
Cost: Total Backorder Cost: Total Hiring Cost Total Firing Cost Total Regular Payroll Cost: Total Overtime Payroll Cost: Total Annual Cost: