Question
In: Operations Management
Harley Davidson purchases components from three suppliers. Components purchased from Supplier A are priced at $...
Harley Davidson purchases components from three suppliers. Components purchased from Supplier A are priced at $ 5 each and used at the rate of 200000 units per year. Components purchased from Supplier B are priced at $ 4 each and are used at the rate of 50,000 units per year. Components purchased from Supplier C are priced at $ 5 each and used at the rate of 22,800 units per year. Currently Harley purchases a separate truckload from each supplier. As part of its JIT drive, Harley has decided to aggregate purchases from the three suppliers. The trucking company charges a fixed cost of $ 400 for the truck with an additional charge of $100 for each stop. Thus, if Harley asks for a pickup from only one supplier, the trucking company charges $ 500; from two suppliers it charges $ 600; and from three suppliers it charges $ 700. Harley incurs a holding cost of 20% (of the price) for each component.
1. What is the Minimal annual inventory cost of the new aggregate replenishment stratedy?
2. What is the minimal annual inventory cost of the Harley's current strategy of ordering seperately from each supplier?
3.How much is the saving resulted?
Solutions
keosha answered 6 months agoRelated Solutions
Harley Davidson purchases components from three suppliers. Components purchased from Supplier A are priced at $...
Harley Davidson purchases components from three suppliers.
Components purchased from Supplier A are priced at $ 5 each and
used at the rate of 206700 units per year. Components purchased
from Supplier B are priced at $ 4 each and are used at the rate of
25,000 units per year. Components purchased from Supplier C are
priced at $ 5 each and used at the rate of 10,000 units per year.
Currently Harley purchases a separate truckload from each supplier....
Harley Davidson purchases components from three suppliers. Components purchased from Supplier A are priced at $...
Harley Davidson purchases components from three suppliers.
Components purchased from Supplier A are priced at $ 5 each and
used at the rate of 240,000 units per year. Components purchased
from Supplier B are priced at $ 4 each and are used at the rate of
30,000 units per year. Components purchased from Supplier C are
priced at $ 5 each and used at the rate of 10,800 units per year.
Currently Harley purchases a separate truckload from each supplier....
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price data (in price per unit) are as follows:
Supplier
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1
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Edwards Manufacturing Company purchases two component parts from three different suppliers. The suppliers have limited capacity,...
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three different suppliers. The suppliers have limited capacity, and
no one supplier can meet all the company’s needs. In addition, the
suppliers charge different prices for the components. Component
price data (in price per unit) are as follows:
Supplier
Component
1
2
3
1
$10
$14
$10
2
$16
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$10
Each supplier has a limited capacity in terms of the total
number of components it can supply. However, as long as...
Edwards Manufacturing Company purchases two component parts from three different suppliers. The suppliers have limited capacity,...
Edwards Manufacturing Company purchases two component parts from
three different suppliers. The suppliers have limited capacity, and
no one supplier can meet all the company’s needs. In addition, the
suppliers charge different prices for the components. Component
price data (in price per unit) are as follows:
Supplier
Component
1
2
3
1
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$10
Each supplier has a limited capacity in terms of the total
number of components it can supply. However, as long as...
Edwards Manufacturing Company purchases two component parts from three different suppliers. The suppliers have limited capacity,...
Edwards Manufacturing Company purchases two component parts from
three different suppliers. The suppliers have limited capacity, and
no one supplier can meet all the company’s needs. In addition, the
suppliers charge different prices for the components. Component
price data (in price per unit) are as follows:
Supplier
Component
1
2
3
1
$12
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$11
2
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$10
Each supplier has a limited capacity in terms of the total
number of components it can supply. However, as long as...
Edwards Manufacturing Company purchases two component parts from three different suppliers. The suppliers have limited capacity,...
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three different suppliers. The suppliers have limited capacity, and
no one supplier can meet all the company’s needs. In addition, the
suppliers charge different prices for the components. Component
price data (in price per unit) are as follows:
Supplier
Component
1
2
3
1
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2
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Each supplier has a limited capacity in terms of the total
number of components it can supply. However, as long as...
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