ImportHome LLC

Revisit: Company Background

$$ Family business: self$-$financed, home as office, garage as warehouse, self$-$maintained

online store

$$ Annual revenue around $$600,000$

$$ B$2$C online retailer of kitchen$-$ware: soymilk maker, pressure cooker, frying pan, etc.

$$ Target at the Chinese community in North America

Assumptions:

$1.$ Estimated Shipping cost, Co $=$ $$3300($full container$)$

Co $=$ $$2100($half container$)$

$$ Lead time for Full Container is $13$ weeks

$$ Lead time for Half Container is $15$ weeks.

$$ Inventory holding cost, Cc $=18\%$ of the product price

$$ Product Price $=$ $$90$

$$ Assume Service level $=95\%$

$$ The aggregated quantity of products needs to be ordered for the business.

Please use sales data from the attached excel file for the solution

The task:

Please determine the best inventory model based on $2$ years sales data, select the shipping

method $($full container vs half container$)$ and calculate annual operating cost