Module Six Homework - Module Six Homework 1 Module Six Homework Michael Keister QSO 630 Supply Chain Management Southern New Hampshire University June 2

Module Six Homework, 1 Module Six Homework Michael Keister QSO 630: Supply Chain Management Southern New Hampshire University June 2, 2015

Module Six Homework, 2 Questions Nine:Consider a supply chain consisting of a single manufacturing facility, a crossdock, and two retail outlets. Items are shipped from the manufacturing facility to the cross-dockfacility and from there to the retail outlets. Let L1 be the lead time from the factory to the cross-dock facility and L2 be the lead time from the cross dock facility to each retail outlet. Let L = L1 +L2. In the analysis below, we fix L and vary L1 and L2.a.Compare the amount of safety stock in two systems, one in which lead time from the cross-dock facility to a retail outlet is zero (i.e., L1 = L and L2 = 0) and a second system in which thelead time from the factory to the cross-dock facility is equal to zero (i.e., L1 = 0 and L2 = L).b.To reduce safety stock, should the cross-dock facility be closer to the factory or the retailoutlets? For this purpose, analyze the impact of increasing L1, and therefore decreasing L2, ontotal safety stock (Simchi-Levi, Kaminsky, & Simchi-Levi, 2008, pgs. 60-61).