Assumptions: 1. Estimated Shipping cost, C, - $3300 (full container) C. $2100 (half container) - • Lead time for Full Container is 13 weeks • Lead time for Half Container is 15 weeks. Inventory holding cost, C, - 18% of the product price Product Price - $90 Assume Service level - 95% The aggregated quantity of products needs to be ordered for the business. Please use sales data from the attached excel file to determine The task: Please determine the best inventory model based on 2 years sales data, select the shipping method (full container vs half container) and calculate annual operating cost.

Assumptions: 1. Estimated Shipping cost, C, - $3300 (full container) C. $2100 (half container) - • Lead time for Full Container is 13 weeks • Lead time for Half Container is 15 weeks. Inventory holding cost, C, - 18% of the product price Product Price - $90 Assume Service level - 95% The aggregated quantity of products needs to be ordered for the business. Please use sales data from the attached excel file to determine The task: Please determine the best inventory model based on 2 years sales data, select the shipping method (full container vs half container) and calculate annual operating cost.

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

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A supplier ships goods from Richmond, VA to three market places in 3 cities (Chicago, IL; Athens, GA; St. Luis, MO). The supplier can ship every day, every other day, or every third day. There is a penalty of $0.30/cwt for each day delayed. Consolidating shipments allows for lower transportation costs from larger loads, but incurs penalty costs due to the delay. Transportation Rate (S/cwt) Shipment City Weight/day LTL 50,000 lb 50000 lb Chicago, IL 18,000 lb (180 cwt) 1.50 1.25 Athens, GA 15,000 lb (150 cwt) 1.35 1.00 St. Luis, MO 12,000 lb (120 cwt) 2.00 1.50 Total 45,000 Ib = 450 cwt Find what is the cost for the following: Shipping Every Day Shipping on the alternate Day (every two days) Shipping every three Day
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