Be sure to always round inventory quantities (Q, R, SS, average number of orders ) values up to the next integer for the final answers. All other values should be calculated based on the standard formulas without rounding them to integers with one decimal place (e.g. average inventory 13.8, Holding cost 8.5, etc.). You dont need to round the "average number of orders" when calculating AOC. Round number of orders if it is the final question.

1. Research the Web (news, short articles, etc.) for Walmart on inventory even before COVID. Here are a couple of articles to get you started. Summarize your findings. Visit a Walmart and look at the shelves from that perspective. Are you seeing the problems you have researched? What are some of the products that are completely out of stock? What do you recommend Walmart do?

2. Floral Beauty, Inc., is a large floral arrangements store located in Asheville Mall. Bridal Lilies, which are a specially created bunch of lilies for bridal bouquets, cost Floral Beauty $19 each. There is an annual demand for 22,000 Bridal Lilies. The manager of Floral Beauty has determined that the ordering cost is $85 per order, and the carrying cost, as a percentage of the unit cost, is 14%. Floral Beauty is now considering a new supplier of Bridal Lilies. Each lily would cost only $17.50, but to get this discount, Floral Beauty would have to buy shipments of 2,000 Bridal Lilies at a time. Should Floral Beauty use the new supplier and take this discount for quantity buying?

a) What is the EOQ for the current supplier?

b) What is the annual ordering cost for the current supplier?

c) What is the holding cost per unit per year for the current supplier?

d) What is the total annual inventory cost (including purchase cost) for the current supplier?

e) What is the annual holding cost for the new supplier (when purchasing 2,000 for each order)?

f) What is the total annual inventory cost (including purchase cost) for the new supplier (when

purchasing 2,000 for each order)?

g) What should Floral Beauty do?

3. Peter Sagan is in charge of maintaining hospital supplies at Champs Hospital. During the past year, the mean weekly demand for a special type of tubing was 186 packages of this tubing with a standard deviation of 13 packages of tubing. The lead time for receiving this tubing from the supplier is 1.5 weeks. Peter would like to maintain a 95% service level and places an order for 750 packages every time an order is placed.

a) How much safety stock should be used for a 95% service level?

b) If the weekly demand is 186 and there is a 1.5-week lead time - what is the reorder point (95%

service level)?

c) How much safety stock should be used for a 99% service level?

d) If the weekly demand is 186 and there is a 1.5-week lead time - what is the reorder point (99%

service level)?

e) If the carrying cost per year is $0.50/unit/year - what is the additional cost associated with the

99% service level compared to 95% service level (i.e. cost of safety stock at 99% level - the cost of

safety stock at 95% service level)?

4. The finished goods inventory of a small manufacturing company is shown below (available in the data

file for Module 9). Perform an ABC analysis on the data (Assign A items to a maximum of 70 % of the

cumulative value and B items to a maximum of the next 20% of the cumulative value (a total of 90%).)

a) How many items are assigned as A items?

b) How many items are assigned as B items?

c) How many items are assigned as C items?

d) What assignment was made to the following items: 2456? 1204? 1448? 9034?

\begin{tabular}{|l|l|l|} \hline SKU Code & Value (\$) & Demand (units) \\ \hline 1021 & 125.00 & 100 \\ \hline 1204 & 10.00 & 1,750 \\ \hline 1448 & 12.00 & 2,000 \\ \hline 2144 & 20.00 & 200 \\ \hline 2282 & 17.00 & 330 \\ \hline 2456 & 500.00 & 675 \\ \hline 2698 & 25.00 & 85 \\ \hline 3129 & 5.00 & 2,500 \\ \hline 3141 & 2.00 & 1,000 \\ \hline 3310 & 1.00 & 1,500 \\ \hline 3312 & 0.75 & 625 \\ \hline 3712 & 8.00 & 200 \\ \hline 3943 & 1.50 & 125 \\ \hline 4351 & 0.75 & 410 \\ \hline 4682 & 3.00 & 700 \\ \hline 4683 & 1.00 & 1,200 \\ \hline 4991 & 1500 & 320 \\ \hline 5231 & 20.00 & 600 \\ \hline 5940 & 110.00 & 120 \\ \hline 5995 & 50.00 & 1,500 \\ \hline 6466 & 0.90 & 200 \\ \hline 6912 & 8.00 & 1,200 \\ \hline 7006 & 45.00 & 1,700 \\ \hline 7060 & 3.00 & 300 \\ \hline 7087 & 4.00 & 800 \\ \hline 7670 & 2.00 & 75 \\ \hline 8101 & 10.00 & 6,000 \\ \hline 8447 & 7.00 & 800 \\ \hline 8989 & 6.00 & 500 \\ \hline 9034 & 4.00 & 1,500 \\ \hline \end{tabular}