NFL Reebok Jersey Inventory Case study Thread Sheralos Boby Given the uncertainty associated with player demand, how should Reebok approach inventory planning for NFL replica jerseys? Given the uncertainty associated with the NFL players Reebok should analyze the market for trends and relevancy by using forecasting. Reebok must keep in. mind the change in demand as the NFL season progresses as well as the popularity of certain players. It is found that team wins, holidays and play offs and trades affect the demand of team jerseys. Moreover, the inventory should reflect the annual sales cycle which begins in January and the chase which is between September and January. Inventory managers should be careful to anticipate the popularity of teams and players with preseason forecasts to meet the customer demands. Stocking too much of a popular player may be a detrimental decision in inventory if the player becomes unpopular. Also, the opportunity to sell high volumes of product for a breakthrough player should be expected and inventory should reflect this as well. What should Reebok's goal be? Should Reebok minimize inventory at the end of the season or maximize prots? Can Reebok achieve both? What service level shciuld Reebok provlde to its customers? When considering information and supply chain tradeoffs, mangers in the supply chain have conflicting goals (Simchi-Levi et al., 2021, p. 149). Furthermore, the optimal level of inventory must be determined to create a healthy dynamic between the costs of inventory held and sales. Also, when sales decline, firms must have high inventory agility to adapt their inventories to the current market and sustain their relative inventories which helps to avoid inventory-related costs (Udenio et al., 2018). In the case of Reebok, they are faced with high levels of inventory that they cannot sell due to the shift in demand. It was found that there was difficulty forecasting demand with several uncontrollable factors dealing with an NFL team and its players' popularity. This uncertainty caused Reebok to have large lot sizes of units which created large inventory for reebok at the end of the season. in this case, Reebok's goals should be to minimize inventory at the end of the season to maximize their profits by adopting a system that enhances logistical information gathered through forecasting. Lastly, Reebok should provide a high level of customer service by adopting advanced supply chain management techniques to increase their customer service levels. It is important to recognize that the most effective supply chain should minimize costs and conform to customer service needs (Simchi-Levi et al., 2021, p. 5). Furthermore, utilizing a strategy that involves not holding inventory, and responding to specific orders can decrease lead times, inventory, and satisfy demands. Perhaps, using a pull-based supply chain can be instrumental in maximizing the service level with a significant reduction in both inventory level and system costs (Simchi-Levi et al., 2021, p. 173). This strategy is ideal for Reebok maintain its reputation as an organization that provides a high level of customer service and quality products as a sole source provider. Aretha models in section 2.2 helpful here? What is the costs of underage for a dressed jersew What is the costs of average for a dressed jersey? How might Reebok decide between dressed jersey and blank jerseys? The model in this section is notes helpful in this case forecasting the uncertainty in demand for Reebok. Since we are determining average and underage, certain costs must be identified to complete the calculations. inventory averages and underages are generally negatively associated with financial performance (Udenoi et al., 2018). However, identifying these averages and underages can assist a firm in linking its performance and profitability to achieve long term financial health. Reebok sells jerseys wholesale for $24.00. Blankjerseys cost $9.50 and dressed jerseys $10.90. to calculate the underage here subtract the costs incurred with the jerseys which total $10.90. The underage is calculated at $13.10. The average for a dressed jersey is $24.00 minus the total costs associated with blankjerseys ($11.90). The average is calculated at $12.10. Reebok might decide between dressed jerseys and blank jerseys by considering lead times from the CM's to the DC in lndianapolis. Since March and June are the most difficult times of the season to fill orders, reebok should rely on forecasting. Utilizing the previous season's forecasting data to determine if having blank jerseys at its 00 in lndianapolis is the most probable decision. Using the forecast for the New England Patriot. what Is the optimal quantlty to order for each player? For biankjerseya? What profit do you expect for Reebok? How much and what type of inventory ls expected to be left over at the and of the season? What service level? Investors use sales surprise or revenue surprise (the degree to which actual sales exceed expected sales) as an important component of firm valuation (Manikas et al., 2016). In cases where forecasting was inaccurate Reebok must find ways to ensure that they have product available to the customer. Reebok's manufacturer produces 1748 jerseys at $24.00. which is $41,472. The optimal quantity for each player's dressed jerseys for the top 6 players identified in the forecast is110,955. Reebok must consider tightly managing their inventory since inventories are viewed as an important factor of the working capital. Considering the previous demand forecasts, the optimal quantity for Reebok to order should be 33,643(sum of minimum for top players) dressed jerseys which includes 23,275 other players which totals $807,432 in the beginning of the season. At the end of the season, I expect no leftovers if Reebok decides to do a push pull strategy mid-season at the highest service level and order based on previous sales and current demand. Lastly, reebok can calculate the profit as the selling price per unit (how much the manufacturer produces) - fixed production cost. Please see below calculation for profit 24.00{1728) = 41,472 -6221 1728 x 9.50=16,416 1728 x 10.90= 18,335 Total=35,251 for dressed jersey's References Manikas, A. 8., a Patel, P. C. (2016). Managing sales surprise: The role of operational slack and volume flexibility. International Journal of Production Economics; 779, 707- 116. https:/ldoi.orgl10.1016/j.ijpe.2016.05.019 Simchi-Levi, D., Kaminsky, FL, & Simchi-Levi, E. (2021). Desr'gnmg and Managrng the 5:40pr Chem: Concepts, Strategies and Case Studies (4th ed). Richard D. lrwin, inc. Udenio, M., Hoberg, K., & Fransoo, .J. C. (2018). inventory agility upon demand shocks: Empirical evidence from the financial crisis. Journal of Operations Management, 62(1), 16-43. httpsdoi org/10.101&Z'|,'|Qm.2018.0_3 001