A baking company situated in New York employs fewer than 200 blue collar employees which has informal atmosphere. The company produces soft cookies over 50 varieties. The company has niche segment of customers promising high quality biscuits. Most of the patrons are over the age of 45 and prefer soft and non-sugary cookies. The production process begins as soon as the management gets the order from its distributors. The production follows batch processing system. The list of cookies to be made is fed into the system by the personnel in charge and the system evaluates the quantity of ingredients to be mixed. The process is followed by a giant machine where additional products are mixed, baked, cooled and tested to check the quality. Finally the cookies are boxed and labeled automatically. The manufactured cookies are shipped instantaneously due to the perishable nature. The cookies are tested for its quality by a testing inspector. X-ray test is also done to detect the existence of any foreign materials inside the cookies. The company takes extra care to reduce the scrap formation and gets inputs from its customer for further potential developments. To determine: The factors which cause the company to carry out minimal amounts of certain inventories and the benefits from this policy.

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Introduction:

A baking company situated in New York employs fewer than 200 blue collar employees which has informal atmosphere. The company produces soft cookies over 50 varieties. The company has niche segment of customers promising high quality biscuits. Most of the patrons are over the age of 45 and prefer soft and non-sugary cookies.

The production process begins as soon as the management gets the order from its distributors. The production follows batch processing system. The list of cookies to be made is fed into the system by the personnel in charge and the system evaluates the quantity of ingredients to be mixed. The process is followed by a giant machine where additional products are mixed, baked, cooled and tested to check the quality. Finally the cookies are boxed and labeled automatically.

The manufactured cookies are shipped instantaneously due to the perishable nature. The cookies are tested for its quality by a testing inspector. X-ray test is also done to detect the existence of any foreign materials inside the cookies.

The company takes extra care to reduce the scrap formation and gets inputs from its customer for further potential developments.

To determine: The factors which cause the company to carry out minimal amounts of certain inventories and the benefits from this policy.

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