'Master of International Business Essay\r'

'What is scroll turnover? How crapper a high lineage turnover proportion be detrimental to a upstanding? Inventory turnover refers to the anatomy of propagation that live air is give in a oneness year period. It fag end be calculated by dividing the apostrophize of goods sold for a particular period by the average scrolling for that period. High entry turnover may signal a low level of inventories, which can improver the chance of output strainouts. 2. get laid among cycle, sanctuary, pipeline, and inquisitive contain.\r\nCycle (base) tired refers to catalogue that is select to satisfy normal consider during the blood line of an set up cycle. Safety (buffer) stock refers to neckcloth that is held in addition to cycle stock to guard against uncertainty in contain and/or lead duration. Pipeline (in-transit) stock is pedigree that is en route amid some(prenominal)(prenominal)(a) nodes in a logistics system, bit speculative stock is armory that is held for several(prenominal) tenabilitys to allow seasonal demand, projected impairment increases, and voltage product shortages. 3. Define what is meant by inventory carrying be.\r\nWhat ar some of its master(prenominal) components? Inventory carrying be refer to the cost associated with sustaining inventory. Inventory carrying costs consist of a play of different components, and their grandeur can vary from product to product. These components include obsolescence costs, shrinkage costs, storage costs, taxes, and interest costs. 4. cover the concept of stockout costs. How can a stockout cost be calculated? Stockouts refer to dapples where customers demand percentage points that atomic number 18 non immediately for sale and stockout costs refer to the costs associated with not having pointednesss avail competent.\r\nCalculation of a stockout cost head start requires a company to classify potential customer responses to a stockout (e. g. , delays the purchase, befogged sale, lost customer). Next, the company demand to distri notwithstandinge probabilities to the sundry(a) responses as well as to assign monetary losses to the various responses. The complimentsive probabilities and losses atomic number 18 multiplied in concert and then all costs atomic number 18 summed to yield an average cost of stockout. 5. Distinguish between a fixed night club standard and fixed graze separation system. Which one generally requires more(prenominal) pencil eraser stock? Why?\r\nIn a fixed piece quantity system, the baseball club size stays constant (although the time detachment between ball clubs may vary); in a fixed order interval system, the time interval is constant (although the order size may vary). The infrequency of inventory monitoring makes a fixed order interval system more convincible to stockouts and thus there is likely to be higher levels of safety stock in a fixed order interval system. 6. Explain the logic of the EOQ m ystify. The logic of the EOQ pathl is as follows: determining an order quantity requires a company to balance deuce costs; the costs of carrying the inventory and the costs of ordering it.\r\nInventory carrying costs ar in direct proportion to order size; that is, the larger the order, the greater the inventory carrying costs. Ordering costs, by contrast, tend to ebb with order size but not in a linear fashion. The EOQ attempts to fetch the point (quantity) at which ordering costs equals carrying costs. 7. How can inventory course diagrams be useful to a logistics manager? They boon a visual depiction of additions to, and subtractions from, inventory. This could be helpful in identifying any patterns that power be occurring.\r\nIn addition, inventory flow examples illustrate how safety stock can offset an increased rate of demand as well as lengthy than normal reclamation cycles. 8. Discuss what is meant by ABC compendium of inventory. What be several measures that can be used to experience ABC status? ABC compendium is an admission that recognizes all inventories are not of equal value to a rigid and, as a result, all inventory should not be managed in the corresponding way.\r\nMeasures that can be used to detect ABC status include gross revenue wad in dollars, sales volume in units, the fastest selling items, item pro followability, or item importance. . What are implications of the JIT approach for supply cosmic string management? The consequences of JIT in truth go far beyond inventory management and JIT has all important(p) implications for supply stove efficiency. One implication is that suppliers must hand over high quality materials to the production line, in part be accept of JIT’s emphasis on low (no) safety stock. Moreover, because customers in a JIT system tend to place smaller, more frequent orders, it is imperative that suppliers’ order systems are capable of handling an increased number of orders in an error-fr ee fashion.\r\nSmaller, more frequent orders, twin with close supplier location, tend to regard transport as a mode of transportation and this means that production and diffusion facilities should be designed to support truck shipments. 10. How does vendor-managed inventory differ from traditional inventory management? In â€Å"traditional” inventory management, the size and timing of replenishment orders are the responsibility of the companionship using the inventory. to a lower place vendor-managed inventory, by contrast, the size and timing of replenishment orders are the responsibility of the manufacturer.\r\nThis represents a great philosophical shift for some organizations in the sense that they are allowing an different party to charter control over their inventories and this requires a great oversee of trust among the various parties. 11. Do stockpile items or complementary color color items present the greater managerial dispute? Support your answer. Eit her answer would be acceptable. Students should recognize that both substitute items and complementary items present managerial gainsays, but the character of these challenges is different.\r\nFor instance, one challenge with substitute items energy be the amount of product to hold; a challenge with complementary items capacity be product placement in a retail outlet. 12. Define what it meant by dead inventory. What are several ship canal to manage it? Dead inventory refers to product for which there is no demandâ€at least under current merchandise practices. Because dead inventory has often been associated with overproduction of items that customers do not want (or need), one suggestion would be make to order as opposed to make to stock.\r\nHaving verbalise this, an increasing source of dead stock in recent years involves special, extremely customized orders that never end up with the customer. Suggestions for traffic with this situation include partial (or full) prepaym ent as well as a no- wages policy. an some other(prenominal) suggestion is for companies to more aggressively market their dead stock, and companies force alike sell dead inventory via auctions. Another happening is to donate the dead inventory to compassionate causes. A last resort is to exclusively throw away the dead inventory in order to free up storage space. 13.\r\nExplain how an SKU might allow different meanings, depending on one’s position in the supply chain. A retailer, for example, might keep records in ground of individual items or incase lots, tour the warehouse that supplies the retailer may deal only with case lots or palettetes fill up of a product. In turn, the distributor that sells to warehouses may deal with only pallet loads or vehicle loads, and may only accept orders only for pallet loads or vehicle loadsâ€and not case lots or individual items. 14. Why is it important for a manager to understand informal devotions with respect to inve ntory management?\r\nOne reason is that the increasing quest for customer serve and customer satisfaction is leading more companies to engage in informal considerations. dismantle though â€Å"formal” inventory analysis should not be ignored, they should not be applied without taking into account informal arrangements. The informal arrangements may not fit any â€Å"formal” inventory tenets, but many informal considerations tend to do an excellent job of satisfying customers. And, without customers, businesses are not going to be real successful. 15. Discuss some of the challenges that are associated with managing touch on and transposition force out.\r\nOne challenge is the bother in forecasting the demand for these productsâ€when result products break down or cave in? As such, it becomes challenging with respect to which move to carry as well as the appropriate stocking levels for them. Another challenge involves the number of warehousing facilities to be used: Should the parts be more decentralized or more centralized? These and other challenges have caused some companies to outsource their repair/replacement parts business. 16. Which presents the greater override logistics challenge: (1) Re saturnine items or (2) Refurbished and recycled products? Support your answer.\r\nAs was the case with question 11, either answer is acceptable. Again, it is important to recognize that both present reverse logistics challengesâ€but the nature of the challenges is different. For example, there is flightiness with respect to returned items, in terms of return rates and product content. Refurbishing and recycling, by contrast, are predicated on sufficient product volumes, which require adequate storage space. 17. What are substitute items and how might they affect safety stock policies? Substitute items refer to products that customers view as being able to fill the homogeneous need or want.\r\nWith respect to safety stock policies, if a consumer has little indecision in substituting another item for one that is out of stock, there would come to the fore to be minimal penalties for a stockout. It is also important that companies understand substitution patterns in the sense that reaping A may be a substitute for Product B, but the reverse may not be true. In such a situation, safety stock policies would need to ruminate the appropriate relationships. 18. Which supply chain participant(s) should be responsible for managing inventory levels? Why?\r\nThe mention to this question is the word â€Å"managing. Although various inventory approaches may require certain select participants to maintain the inventory, supply-chain effectiveness and efficiency would implore that all supply chain participants should be involved with managing inventory levels. Because the supply chain is a system, one company’s inventory policies and practices can impact the other members of the supply chain. Failure to consider thes e other participants when setting inventory policies and practices could lead to impaired consequences. 19. Should inventories be considered investments? Why?\r\nThe text suggests that inventories should be considered investments. Carrying costs for inventories can be world-shaking; the return on investment to a firm for its funds tied up in inventory should be as high as the return it can obtain from other, equally risky uses of the same funds. 20. Since the mid-1990s, many beer and soft-drink cans and bottles have contained a archness date stamped on them to indicate the modish date that the product should be consumed. What problems might such a system cause for the people responsible for managing such inventories? Discuss.\r\n there are a variety of likely answers to this question. One consideration is that product needs to be in places where it can be bought prior to the expiration date. At a minimum, this means that companies need to be able to identify individual product s, locate the products, and move the products to the appropriate place(s). The oldest inventory should be â€Å"turned” before other inventory. Another consideration involves what to do with expired product, a situation that brings into play reverse logistics considerations.\r\n'