Purchasing and Supply Chain Management
Purchasing and Supply Chain Management
6th Edition
ISBN: 9781305809789
Author: MONCZKA
Publisher: Cengage
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Chapter 12, Problem 7DQ
Summary Introduction

To explain: The way Person X would go about identifying value analysis opportunities.

Purchasing and supply chain analysis tools and techniques:

It is essential for possessing the right tools and techniques in supply chain management. It is very essential to ensure that the organization always chooses toe right supplier for their organization. There are many tools and techniques such as project management, learning curve, process mapping, and others.

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The annual demand for water bottles at Mega Stores is 500 units, with an ordering cost of Rs. 200 per order. If the annual inventory holding cost is estimated to be 20%. of unit cost, how frequently should he replenish his stocks? Further, suppose the supplier offers him a discount on bulk ordering as given below. Can the manager reduce his costs by taking advantage of either of these discounts? Recommend the best ordering policy for the store. Order size Unit cost (Rs.) 1 – 49 pcs. 20.00 50 – 149 pcs. 19.50 150 – 299 pcs. 19.00 300 pcs. or more 18.00
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