Question
Costs for John Deere manufacturing in the US have increased by 50% over the last three years. John Deere employs a labor force of 1,500
Costs for John Deere manufacturing in the US have increased by 50% over the last three years. John Deere employs a labor force of 1,500 people across 5 factories (Alabama; California; Colorado; New York; and Texas). John Deere utilizes both general and custom-made parts to manufacture its machines. General parts have increased in price by 20% since 2017 and custom parts have increased 300% in the last year alone. Another costly input is computer electronics which accounts for 40% per machine. The cost distribution is as follows: Total Cost: $75,000 Labor Cost: $20,000 Electronics: $35,000 Parts / Other Inputs: $20,000 Discuss your top 3 strategy options for combating the rising cost of manufacturing.
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