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Unformatted text preview: Value Chain Analysis I NBOUND LOGIST ICS Just-I n-Time Inventory Dell refers to their supplier as their value chain rather than the supply chain. Dell maintains close relationships and communication with suppliers to blend the best technology and service from suppliers into a leading edge mix for consumers (Hall, 2000). Probably the most unique characteristic of Dells business model is that Dell carries no inventory. In fact, They force suppliers to carry all the inventory and therefore the suppliers assume all risk and cost associated with this inventory (Russell, 2010). Almost all mechanical parts are provided by local suppliers and shipped to the assembly units using the just-in-time (JIT) process. Electrical components are also shipped in using the JIT and all components are sent to a kitting line which feed ten assembly cells (Hall, 2000). Assembly time for a desk top is about thirty minutes, then software load and testing takes 2.5 hours for the average computer. Almost all orders are shipped within 8 hours after they are kitted to start production (Hall, 2000). From receipt of purchase to finished good ready to be shipped to customer, the entire process takes 3.5 days. The JIT inventory system significantly contributes to Dells ability to customize a product specifically to the purchaser and had it ready for delivery 3.5 days after receipt of purchase. This inventory system has also contributed to Dells ability to be the low-cost provider of computers in the market.also contributed to Dells ability to be the low-cost provider of computers in the market....
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This note was uploaded on 06/20/2011 for the course MGT 476 taught by Professor Duffy during the Spring '10 term at Sam Houston State University.
- Spring '10