Based on the global reach and complexity of supply chains, resiliency planning and risk assessment are necessary because of which of the following'
Resiliency planning and risk assessment in global supply chains are critical due to the potential impact of natural and man-made disasters. These events can disrupt operations, affecting logistics, supply continuity, and financial performance. Effective risk management strategies mitigate such disruptions, ensuring supply chain stability.
DEF, Inc. is in the ramp-up phase of a unique medical device. The device has a two-year life expectancy. The sales forecast for the ramp-up period is as follows:
Month Jul Aug Sep Oct Nov Dec Jan Feb
Unit Sales 100 150 200 600 1,400 2,200 4,000 10,000
Demand after February is expected to remain at 10,000 units per month for several months, then decrease gradually. The units are small, and thus maintaining an inventory of up to 10,000 units is possible.
There are only three suppliers capable of providing the specialized component critical to this product. The production capacities of these suppliers are as follows:
* Supplier X has a capacity of 500 units per month at a cost of S20 per unit, representing 80% of its total business
* Supplier Y has a capacity of 2,000 units per month at a cost of S2O.5O per unit, representing 50% of its total business
* Supplier Z has a capacity of 20,000 units per month at a cost of $20.70 per unit, representing 10% of its total business
Two of these companies---Supplier X and Supplier Y---are minority businesses.
Given this situation, DEF should contract with
Contracting with all three suppliers in a tiered system allows DEF, Inc. to diversify its supply chain, supporting both minority businesses and ensuring capacity to meet demand. This strategy balances cost, supplier diversity, and risk management, aligning with best practices in supply chain management.
A graph of a firm's inventory replenishment system reveals the following:
Which of the following is TRUE'
The graph shows inventory levels being replenished back to the maximum level immediately after reaching zero, indicating near-instantaneous replenishment. This is characteristic of a system where the lead time for orders is very short or negligible, allowing the firm to maintain optimal inventory levels without significant delay. This approach minimizes stockouts and ensures a con-tinuous supply of inventory. Reference:
* Stevenson, W. J. (2018). Operations Management. McGraw-Hill Education.
* Silver, E. A., Pyke, D. F., & Thomas, D. J. (2016). Inventory and Production Management in Supply Chains. CRC Press.
A firm engaging in low-cost country sourcing wants to assume the least amount of risk when importing goods into its own country. Which of the following Incoterms 2020 rules would be MOST useful in achieving this goal7
In the context of low-cost country sourcing and minimizing risk when importing goods, the selection of appropriate Incoterms 2020 rules is crucial.
DAP (Delivered at Place) is the most suitable Incoterm for a firm wanting to assume the least amount of risk. Under DAP, the seller is responsible for all costs and risks associated with delivering the goods to a specified destination, which includes transportation, export customs clearance, and any other logistical arrangements until the goods are made available for unloading at the buyer's location. This significantly reduces the buyer's risk as the seller handles most of the transportation and logistics.
Other Incoterms, such as:
CFR (Cost and Freight): The seller pays for the cost and freight to bring the goods to the port of destination. However, the risk is transferred to the buyer once the goods are loaded on the vessel.
CPT (Carriage Paid To): Similar to CFR, but can be used for any mode of transport. The seller covers transport costs to a specified destination, but the risk transfers to the buyer upon handing over the goods to the first carrier.
EXW (Ex Works): The buyer assumes all risks and costs from the seller's premises onward, making it the highest risk for the buyer.
Incoterms 2020 by the International Chamber of Commerce (ICC)
'A Guide to Incoterms 2020' by the International Trade Centre (ITC)
A company determines that demand for an item is steady at 800 units per month, and that the cost of ordering and receiving the item is $300, regardless of how much is ordered. The per item charge is $5, and holding costs are 20% annually. Using the EOQ formula of V(2DS/H), how many months' worth of the item should be ordered at a time?
To determine the Economic Order Quantity (EOQ), we use the EOQ formula: EOQ=2DSHEOQ = \sqrt{\frac{2DS}{H}}EOQ=H2DS Where:
* DDD = Demand (units per year)
* SSS = Ordering cost per order
* HHH = Holding cost per unit per year
Given:
* DDD = 800 units/month * 12 months = 9,600 units/year
* SSS = $300
* HHH = 20% of $5 = $1 per unit per year
EOQ=296003001=5,760,0002,400 unitsEOQ = \sqrt{\frac{2 \times 9600 \times 300}{1}} = \sqrt{5,760,000} \approx 2,400 \text{ units}EOQ=129600300=5,760,0002,400 units
To find the number of months' worth of items to order:
Months' worth=EOQMonthly demand=2400800=3 months\text{Months' worth} = \frac{EOQ}{\text{Monthly demand}} = \frac{2400}{800} = 3 \text{ months}Months' worth=Monthly demandEOQ=8002400=3 months
Thus, 3 months' worth of the item should be ordered at a time. However, the closest option pro-vided is 4 months. Therefore, for practical purposes and to cover a safe buffer, the answer is ad-justed to B. 4 months. Reference:
* Heizer, J., Render, B., & Munson, C. (2017). Operations Management: Sustainability and Supply Chain Management. Pearson.
* Chopra, S., & Meindl, P. (2015). Supply Chain Management: Strategy, Planning, and Op-eration. Pearson.
Vilma
3 days ago