| Scientific Glass, Inc.: Inventory Management | MPC Assignment |

|

INTRODUCTION
In this case study, production and operations management (POM) issues of a mid-size company, named as Scientific Glass Inc., in a highly growing market are studied. Using the background information on past actions of the company to correct inventory management and their results, and considering the market leadership opportunity, how inventory management approach can be made better is explained by evaluating different alternatives from different aspects. In the first part, critical POM issues are mentioned, following that these problems are analyzed. In the third part, alternative options are listed and then they are evaluated. Finally, considering the …show more content…

Using Global Logistics
Shipping cost of a 10 pound package from Waltham to Atlanta was $4
Waltham to Atlanta - $22.25
Total - $26.25
Total cost from regional warehouse - $20.60
Total cost if using, centralized warehouse in Waltham and using Winged Fleet - $23.60
Beane believed it would be worthwhile to conduct a detailed evaluation of other potential cost impacts

Average Inventory Levels: As demand aggregates number of warehouse decreases, level of inventory decreases as it is expected. This is because, “the greater the degree of collaboration, the lower the uncertainty (standard deviation of the error or coefficient of variation) of the demand model”. This implies that the money tied up in the inventory decreases and this extra capital can be used in other areas, like expansion plans to international markets.
Time Responsiveness: Delivery system of the company compensates 2 weeks of shipment cycles including the stock-out situations. In order to be a market leader, differentiation on this subject is also needed and unfortunately since this is not an exact quantitative scale, only possible situations could be mentioned. For having one centralized, or two centralized or 8 decentralized warehouse options, they all include at most 3 days ready to shipment duration and Winged Fleet’s delivery time of at most 3 days if there is no stock-out situation