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SCM 303 Formulas Chapters 14,9,10,11

# SCM 303 Formulas Chapters 14,9,10,11 - Line fill rate=...

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Chapter 14 Average Inventory- Average inventory = order quantity/2 Reorder point (ROP)- = (Avg. Daily Demand)(Lead time) + Safety Stock TAC- = Annual ordering cost +annual carrying cost with price breaks add annual product cost Annual ordering cost = Co(ordercost) x (Annual demand(D) / (order quantity)Q) Annual Carrying Cost = Unit cost (U) x inventory carrying cost % per year (Ci) x (orderquantity(Q) / 2 ) EOQ= ROP= (d)t d= average demand per time period t= average supplier lead time Safety Stock (SS) = (z) x o ddlt z= number of standard deviations required for the desired service level . o ddlt = standard deviation of demand during lead time. Revisions of earlier statements are required when uncertainty and unpredictability exist. The addition of safety stock to a firms inventory must be added to ROP and average inventory after being calculated. Chapter 9 Unit fill rate= total units delivered/ total units ordered
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Unformatted text preview: Line fill rate= number of order lines delivered complete/total order lines Order fill rate= total complete orders delivered/total orders Chapter 10 Make or buy anaylsis Make= FC + VC Buy = FC + VC Break even point = fixed costs/ (sellingprice- variable costs) Chapter 11 Total cost = In-transit holding cost + Freight cost In-transit holding = days in transit/365 x value x holding cost A firm has orders of 12,000 lbs each of goods for three customers. It is \$15.75 per hundredweight (cwt) to ship direct, or \$10.50 cwt for shipments of greater than 30,000 lbs with a \$300 fee for each stop. Cost of individual shipments: \$15.75 x (12,000/100) = \$15.75 x 120cwt = \$1,890 total for all three shipments = 3 x \$1, 890 = \$5,670 Consolidated shipments: \$10.50 x (36,000/100) = \$10.50 x 360cwt = \$3,780 including stop charge = 3 x \$300 + \$3780 = \$4,680 Saving with consolidation = \$5,670 - \$4,680 = \$990...
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