Reference no: EM133524581

Case Study: After failing several times in easy mode, I was finally able to reach equilibrium on expert mode in 45 weeks. My finished goods inventory matched customer orders in weeks 25 and 38. That's when I noticed that I had to keep increasing and decreasing my productions based on order fluctuations. Some weeks I had more inventory than customer orders. I also had more customer orders than inventory on others. I had inventory shortages during weeks 12 through 15 because I decreased productions through weeks 8 through 11. After increasing production in week 16, I was able to balance productions versus customer orders and have enough inventory to meet demand. Considering the orders that were not completely filled and the new orders, helped me plan my production for the coming weeks after the shortage was fixed.

Question: A real-life example would be the pool chemical shortage we experienced 2 years ago. Before the shortage, my store sold roughly 165 bottles of pool chemicals per week. During the shortage, we only received about 15 bottles per week. That is nowhere near enough to keep up with demand. Walmart then found a vendor to supply the chemicals to help keep up with the shortage, which incurred extra fees since it wasn't delivered by their drivers or from their warehouse. To prevent this from happening, my store's order cap has increased, and we now receive 2 pallets of chemicals every 2 weeks. The quick reaction by Walmart in terms of finding a supplier to keep up with demand was helpful in retaining customers.