MGT 417 Module 4 Case Study 4

MGT 417 Module 4 Case Study 4 . The first number she selected was the A 233 circuit board. The average weekly
usage was 32. The lead time was given as one week. The board cost $18, and the cost
to place an order was given as $16. The quantity ordered to fill the bin was usually 64.
The second number was the P656 power supply. It cost $35, but since the supplier
only required a fax to order the cost was only $2 per order. Even with the fax the
delivery lead time was two weeks. The average weekly demand for the power supply
was 120. The company typically ordered 350 units at a time. Recently the supplier for
the circuit board hinted that it might be able to give Carl’s a price break of $2 per
board if Carl’s would order 200 or more at a time.

MGT 417 Module 4 Case Study 4

Case Analysis
1. Using the data on the two part numbers given, provide a comprehensive evaluation of
the ordering policies. Compare the present annual average cost with the cost of using a
system such as EOQ, and discuss any other order policies as appropriate.
2. Should Carl’s pursue the price break? Why or why not?
3. What do you think the sources of the other problems are? Be specific and analyze as
completely as possible.
4. Develop a comprehensive plan to help Rosa get the inventory back under control.

MGT 417 Module 4 Case Study 4