Sports Obermeyer Case Study
So inviting retailers, especially sales or shop managers, to help with the demand forecasting is a good idea. Obtain market feedback:It is important to obtain market feedback earlier thereby converting some speculative production to reactive production. Sport Obermeyer should listen to ‘early orders’ and get sneak preview of the new line and imply feedback to their production plan. They may create ‘early order discount’ campaign to get quality/quantitate feedback.Reduce lead times:It can be achieved by either actually reducing the lead times or by encouraging the retailers to place their orders in advance. The pre-order of the raw materials (fabric) by Obersport would also help Obermeyer since this would reduce the lead-times of acquiring this fabric during periods of unexpected jump in demand. If the whole process from delivering raw material to finished goods can be completed in a shorter period of time, the company would be able to produce at a time when demand can be forecasted at almost 100% accuracy. The disadvantage of this method is that it would create additional costs of getting raw materials quicker and shipping finished goods at a faster speed and higher cost but it would reduce sunk cost from excess inventory and increase the market share due to…show more content…
However, HK plant would still be kept as a place for smaller size order and unexpected risky circumstances, which may occur in other locations.** I agree with short term and long term relationship with HK and China. But I would like to add one more recommendation which is using HK and China based on the product categories -; HK vs. China Comparison HK ChinaProduction Manufacturing at twice the speed that of China Slow manufacturingLead time Acceptable Several weeks longer than HK Manpower In case of parka line, requires 10workers In case of parka line, requires 10workersQuality Good and reliable quality Lower than HKRegulation US Government imposes stringent quota restriction for imports from China. This may not applicable for Hong Kong.So my recommendation is to source half of it parkas from China and half from Hong Kong would be an efficient operational change to improve performance in Sport Obermeyer. Along with that, Sport Obermeyer should categorize product in two categories: more popular and less popular. More popular should be sourced through HK since production will be faster and the quality will be higher and more reliable. Less popular should source from
Sport Obermeyer Case Solution 1. SPORT OBERMEYER: Case Report Submittedby – Group-7 M002-14 ABHIJIT KUMAR M035-14 LUKALAPU RAJA SEKHAR M057-14 SHIVEN CHAUDHARY M061-14 SNEHIL AGRAWAL M069-14 ABHISHEK JAYANT M075-14 ANKITA M091-14 CHETAN C.INGALESHWAR M120-14 SAYAN KAR. ISYE 4301: Supply Chain Economics Case Study Sport Obermeyer Group 2: Jordan Avery Michael Gilkenson Alina Cornejo Fabio Romero Farida Jariwala. CASE STUDY: SPORT OBERMEYER 5 options that best suit the needs of the organization, Sport Obermeyer must evaluate the most beneficial opportunities. Oftentimes, the lead time from supplier to the warehouse encompasses a number of unknowns and may potentially be random (Simchi-Levi et al., 2021). Sports Obermeyer Case Study 🎓My decision is to find a methodology of calculating more accurate demand and supply figures to address the unpredictable world of. Sport Obermeyer Case Study Analysis. A comparison of two initial production commitments has been performed in the above table, in order to analyze the production difference. It could be seen that a total of 1200 units would be produced in excess in the Chinese plant as comparedto the Hong Kong plant.
Sport Obermeyer Case Solution
Problem Diagnosis
This case described the operations at the merchandising and Skiwear Companyand for its supply partner. It allows for the production planning of the short life cycle products with the uncertain demand in the market. This case also allows us to analyze the reduced version of the production-planning problem of the company. The main concern of Wally Obermeyer was to determine an appropriate production commitment for the first half of the projected demand of Obermeyer during the 1993-1994 seasons.
Sports Obermeyer Case Solution
Along with this, Wally also had to make a complete production decision by deciding that which styles should be made in Hong Kong and which styles would be better to be made in China. In addition, the material flows and the information provided in the case will also guide us to make recommendations to the company regarding the operational improvements and the decision of the sourcing of the products between China and Hong Kong.
Case Analysis
The main analysis needs to be performed on the forecast methods of the company to detect the inaccurate forecast mechanisms and then the after effects need to be analyzed such as the excess merchandise had to be sold at deep discounts and the company might not be able to sell the most popular items during the full season and thus it would result in huge losses for the company. Therefore, we first need to determine the production plan for Sport Obermeyer during the initial phase of production, measure the risk of ordering policy and implement ordering policy in China to make reasonable comparison and recommendations.
Question 1
Using the sample data given in Table 2-20, make a recommendation for how many units of each style Wally should make during the initial phase of production. Assume that all of the 10 styles in the sample problem are made in Hong Kong and that Wally’s initial production commitment must be at least 10,000 units. Ignore price differences among styles in your initial analysis.
The average forecast value and the standard deviation of the different styles of the Parkas of Women have been provided in Table 2-20. The above question asks us to compute the economic order quantity for each of the individual type of the parkas. Economic order quantity is the optimum order quantity, which is required to be held at a minimum by a company so that it could reduce its inventory costs to a minimum level. This quantity model would target the variable costs and determine the optimum quantity for us at which the total variable cost would be minimized for the company’s production. However, in this case the EOQ for the company would be the production order quantity for each individual type of the Parka, given that the total of all of these EOQs should be 10,000 units.
For computing the EOQ, we need to find out the corresponding service level for the sample provided. This ratio has been found by the difference of retail price and cost divided by the difference of cost and salvage value of a unit if not sold. These computations are shown in the excel spreadsheet and in the appendices in exhibit 1. The service level has been calculated to be 0.75 or 75%. Based on this service level, the z value has been determined from the z table, which is 0.645. The formula which we have used here to compute the EOQ is mean+ (z-value*SD). Using this formula, the individual EOQs have been computed and the total EOQ for the forecasted sample of 20,000 units. The price differences between different styles have been ignored for this calculation.
Question 2
Can you come up with a measure of risk associated with your ordering policy? This measure should be quantifiable.
One of the best measures of the risk associated with the ordering policy in this case would be Coefficient of Variation (CV). CV is the ratio of the standard deviation to the expected mean. It shows us the volatility and the variation in the data per unit of mean. However, in the context of this case the CV would be defined as the volatility of each of the types of different styles of Parkas per unit of that style. It would determine the variability of the demand or the ordering policy risk. The higher the volatility, the more certain and accurate the company would have to be to determine the demand for the coming seasons of 1993-1994................................................
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