SCM WEEK Three
Answer the following questions:
A company uses 36,000 tyres to produce car wheels every year. The company can make its own tyres simultaneously at a rate of 500 per day and the carrying cost is £2 per tyre per annum. If the company is open for 240 days of the year and each production run incurs a set-up cost of £40, what is:
Economic production quantity
Total annual set-up and carrying cost
Cycle time for economic production quantity
Be sure to demonstrate your work and provide a brief interpretation. (200 words maximum)
By Day 3, submit your Key Concept Exercise to the submission link provided.
Why is inventory management important to an organisation, and how can inventory management enable an organisation to improve its competitiveness? (300 words maximum)
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