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7 . 8 Case Study: Joint Replenishment Back in his office, Hector types out an email for Jerry. Hi Jerry, Thank you and Tim for

7.8 Case Study: Joint Replenishment Back in his office, Hector types out an email for Jerry. Hi Jerry, Thank you and Tim for visiting my office yesterday. I have a small task for you guys. I was looking at placing an order for the items listed below. Before I confirm the order can you please let me know your best unit price and also the freight costs? 205 S. No. Item name Specifications Quantity (kg)1 Mango Ripe yellow, standard size 20002 Apple Green 2500 Grapes Red/Brown 2000 n+ n Mandarins Standard size 4400 Avocado Ripe 3100 Would appreciate if you can revert by morning tomorrow. Warm Regards Hector The next morning Hector has an email response from Jerry. Hi Hector, Thank you for your email. Please find our best price for the items that you wish to place an order with us for. Do let me know if you have any questions, and we look forward to working with FreskJugo. With regards to freight, we will ship all the above in one vehicle, and it would cost you $80 per shipment. Warm Regards Jerry S. No. Item name Specifications Quantity (kg) Unit price - Mango Ripe yellow, standard size 2000 $2.50 Apple Green 2500 $2.253 Grapes Red/Brown 200053.354 Mandarins Standard size 4400 $1.255 Avocado Ripe 3100 $0.852067 Multi-item Inventory Models Subject to Constraints Case Study Questions 1. Given the information, compute the cost savings if FreskoJugo places a joint order for all the five items with one supplier, over procuring the same five fruits separately. Assume equal number of orders. 2. Discuss the risks involved in placing orders with one vendor for all their supplies.

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