MGT 364 Exam 3 Vocab 9 - 12

MGT 364 Exam 3 Vocab 9 - 12 - CHAPTER 9SUPPLY CHAIN DESIGN...

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CHAPTER 9—SUPPLY CHAIN DESIGN - Supply chain design—designing a firm’s supply chain to meet competitive priorities - Inventory—stock of materials used to satisfy customer demand or to support the production of services/goods - Inventory holding cost—sum of the cost of capital and the variable costs of keeping items on hand, such as storage/handling, taxes/insurance, and shrinkage - Stockout—order that cannot be satisfied, resulting in loss of sale - Backorder—customer order than cannot be filled when promised or demanded but is filled later - Ordering cost—cost of preparing a purchase order for a supplier or a production order for manufacturing - Setup cost—cost involved in changing over a machine or workspace to produce a different item - Quantity discount—drop in the price per unit when an order is sufficiently large - Raw materials—inventories needed for the production of services or goods - Work in progress (WIP)—Items needed to produce a final product in manufacturing - Finished goods—items in manufacturing plants, warehouses, and retail outlets that are sold to the firm’s customers - Cycle inventory—portion of total inventory that varies directly with lot size - Lot sizing—determination of how frequently and in what quantity to order inventory - Safety stock inventory—surplus inventory that a company holds to protect against uncertainties in demand, lead time, and supply changes - Anticipation inventory—inventory used to absorb uneven rates of demand or supply - Pipeline inventory—inventory that is created when an order for an item is issued but not yet placed in inventory - Repeatability—degree to which the same work can be done again - Centralized Placement—keeping all the inventory of a product at a single location such as a firm’s manufacturing plant or a warehouse and shipping directly to each of its customers - Inventory pooling—reduction in inventory and safety stock because of the merging of variable demands from customers - Forward placement—locating stock closer to customers at a warehouse, DC, wholesaler, or retailer - Average Aggregate Inventory Value—total average value of all items held in inventory for a firm - Weeks of supply—inventory measure obtained by dividing avg aggregate inventory value by sales per week at cost - Inventory turnover—inventory measure obtained by dividing annual sales at cost by the avg aggregate inventory value maintained during the year - Channel assembly—process of using members of the distribution channel as if they were assembly stations in the
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MGT 364 Exam 3 Vocab 9 - 12 - CHAPTER 9SUPPLY CHAIN DESIGN...

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