Question
For this assignment, do the following: Compare the two alternatives under consideration for final labeling and packaging: 1. At the production faculty in Malaysia before
For this assignment, do the following: Compare the two alternatives under consideration for final labeling and packaging: 1. At the production faculty in Malaysia before being shipped to the DC (the current approach) and 2. At the DC in St. Louis (i.e., postponing labeling and packaging until just before shipment). The comparison should consider the savings in annual holding cost with aggregation compared to the increased production costs of aggregation. When determining if aggregation is warranted, note that how inventory is managed does not need to be consistent across the three products (computers, printers, scanners). That is, aggregation may be worthwhile for only one or two of the three products, and this approach can be implemented. When analyzing the two alternatives, use a target product fill rate of 99%. Assume that the demand across the four customers is independent but that demand variation is perfectly correlated across weeks.