After the dot-com business he tried to start folded, David "Marty" Dawkins decided to pursue his boyhood dream of owning a bike factory. After several false starts, he finally got the small company up and running. The company currently assembles two models Marty designed: the Arrow and the Dart. The company hasn't turned a profit yet, but Marty feels that once he resolves some of the problems he's having with inventory and scheduling, he can increase productivity and reduce costs.

At first, he ordered enough bike parts and subassemblies for four months' worth of production. Parts were stacked all over the place, seriously reducing work space and hampering movement of workers and materials. And no one knew exactly where anything was. In Marty's words, "It was a solid mess!"

He and his two partners eventually managed to work off most of the inventory. They hope to avoid similar problems in the future by using a more orderly approach. Marty's first priority is to develop a materials requirement plan for upcoming periods. He wants to assemble 15 Arrows and 10 Darts each week, to have them ready at the start of weeks 4 through 8. The product structure trees for the two bikes follow.

One of Marty's partners, Ann, has organized information on lead times, inventory on hand, and lot-sizing rules (established by suppliers):

*LT = 3 weeks for orders of 36 or more units on this item.
Scheduled receipts are:
Period 1: 20 Arrows and 18 Ws
Period 2: 20 Darts and 15 Fs
As the third partner, it is your job to develop the material requirements plan.

Transcribed Image Text:

Arrow Dart K(2) W(2) Item Arrow Dart Lead Time(weeks) on Hand Lot-sizing Rule Lot-for-lot Lot-for-lot Multiples or 25 Multiples or 12 Multiples or 30 Lot-for-lot Multiples or 30 Lot-for-lot 2* 10 15