Exam 3 Practice Flashcards
Generates pressure to increase inventory
quantity discounts, inventory shrinkage costs, backorders and stockouts
items sold to a firm’s customers
finished goods
increasing repeatability
flexible automation
group technology
parts standardization
methods for tracking inventory and ensuring accurate records
logic error checks, cycle counting, assigning responsibility to specific employees for issuing and receiving materials
in a one-period inventory model, the higher the after- season sales price, the higher the order placed at the start of the season
true
if demand exceeds the purchased quantity then the actual payoff exceeds the expected payoff for that quantity
true regarding one period model.
operating expenses
inlcudes selling expenses , fixed expenses and depreciation
comparative advantage of mass cusotmization
elimination of finished goods inventory, management of customer relationships, and increase in perceived value of services/ products.
the bullwhip effect says that in any supply chain, the ordering patterns experience increasing variance as you move closer to the end customer
false
increase the likelihood of a supply chain experiencing the bullwhip effect.
engineering changes to the design of a product
SCOR
plan source make deliver, return
Advantages of Periodic Review System
convenient admin of inventory control & can permit combining order to common suppliers
Effectively changing lot size
increase repeatability
ABC Analysis
Class A items account for 80% of dollar usage, uses the Pareto chart concept, ranked on basis of dollar usage
total cost for a continuous (Q) system with uncertain demand
cycle inventory holding cost
safety stock holding cost
ordering cost
Reasonable approach for EOQ
demand rate is known and constant, lead time is known and constant, no constraints are placed on the size of each lot
primary lever to reduce anticipation inventory
match demand rate with production rate
P system advantage over Q system
orders from multiple items from one supplier can be combined into a single purchase order
Determinant of a favorable labor climate
level of worker productivity, cost of labor, and worker transportation infrastructure.
Break even analysis
quantitative method used to evaluate multiple locations based on total cost of product or service operations
to decrease inventory turnover
increase the average aggregate inventory value
external causes
expected changes in customer demand
cross docking
packs products on incoming shipments so they can be easily sorted at intermediate warehouses for outgoing shipments
one time inventory decision
when a manufacturer makes customized items to single order and scrap quantities are high, when lead time is longer than selling season, when items are fashion goods
