Concept explainers
Tabard Industries forecasted the following demand for one of its most profitable products for the next 8 weeks: 120, 120, 120, 100, 100, 100, 80, and 80 units. The booked customer orders for this product, starting in week 1 are: 100, 80, 60, 40, 10, 10, 0, and 0 units. The current on-hand inventory is 150 units, the order quantity is 200 units, and the lead time is 1 week.
- Develop a MPS for this product.
- The marketing department revised its
forecast. Starting with week 1, the new forecasts are: 120, 120, 120, 150, 150, 150, 100, and 100 units. Assuming that the prospective MPS you developed in part (a) does not change, prepare a revised MPS record. Comment on the situation that Tabard now faces. - Returning to the original forecasted demand level and the MPS record you developed in part (a), assume that marketing accepted a new customer order for 200 units in week 2, and thereby booked orders in week 2 is now 280 units. Assuming that the prospective MPS you developed in part (a) does not change, prepare a revised MPS record. Comment on the situation that Tabard now faces.
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