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“You should visualize inventory as stacks of money sitting on forklifts, on shelves, and in trucks and planes while in transit. That’s what inventory is–money” (Chase, Jacobs, and Aquilano). O’Reilly Auto Parts is a company that has an extensive inventory of products. What are some ways to ensure that O’Reilly doesn’t have its money invested in too much inventory, or the wrong kind of inventory? Similarly, what are some ways to ensure that it doesn’t have so little inventory that it loses sales? What recommendations do you have for O’Reilly to prevent or fix such problems? What role does the accuracy of inventory records play in this issue? Specifically, what are the consequences of inaccurate inventory records (the actual inventory is more or less than what this company’s records says it has) in terms of profits, cost of sales, customer satisfaction, and so on? What strategies do you recommend to O’Reilly to prevent or fix such problems?
The new office supply discounter, Peter Clips Etc. (PCE), sells a certain type of ergonomically correct office chair that costs $300. The annual holding cost rate is 40%, annual demand is 600, and the order cost is $20 per order
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Identify strength and weakness associated with the firm's resources, capabilities, core competency and value chain activities:
Identify the hard and soft technology and interpret the characteristics the company should have/use to be successful in its domestic and global environment.
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