Ch 12 inventory management - InventoryManagement Agenda

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Inventory Management
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Agenda Inventory Concepts and Classification Inventory Control Methods Inventory Models: Deterministic Stochastic
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Inventory Concept A electronics store sells 4 printers a day.  The manager ordered 80 printers, which  takes 20 days to deplete. On top of them,  another 4 printers are hold as buffers.  An assembly process takes four steps to  finish. Right next to each step, there is a  rack of inventory, either parts or sub- assembled products.  
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Inventory Concept A utility company signed a long-term contract of  coals in order to hedge against future price  increase.  Instead of ordering 400 units at the price of $10  each, a retail store placed an order of 500 units,  which qualifies the store for a price of $8 each.  To prepare for the peak demand in the coming  Fall/Winter, the snow blower manufacturer starts  to build up its inventory from May.
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Inventory Concept Form: Raw Materials/Parts Work-in-process Finished Goods In-transit Function: Cycle stock Safety stock Others
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Inventory Control Perpetual control versus Periodic control: Perpetual control: all adding or removing of  inventory are recorded. When inventory falls  to a certain level (ROP), place the next order.  Periodic control: Orders are placed to refill  inventory at fixed time intervals. Inventory is  counted only before each order is placed, and  order quantity equals to the difference  between current on-hand level and the  desired level. 
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This note was uploaded on 09/15/2011 for the course BUSINESS 21 taught by Professor Steingart during the Spring '11 term at San Jose State University .

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Ch 12 inventory management - InventoryManagement Agenda

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