Inventory management assessment

Inventory Management Assessment

Purpose:

The purpose of this assignment is for you to apply the information learned thus far to the development of an inventory plan for the Jones company. You will accomplish this goal by performing an ABC analysis on Jones' stock. You will also calculate the EOQ's for the items.

Instructions:

Now that you’ve assisted Jones Company with their customer demand forecasts, master schedule, and MRP schedule, it’s time to help them get a handle on managing their inventories. You have two objectives.

1. Create an ABC analysis for the following components and recommend at least three ways Jones should manage the inventory of these items based on your analysis.

Part Number

Annual Usage

15A

40,000

23A

86,000

46B

120,000

29C

55,000

54C

250,000

11D

67,000

17E

15,000

49F

68,000

57F

140,000

62G

77,000

2. Calculate EOQs for these items. Ordering costs for the first five items are $50 and for the second five items are $70. Carrying costs for the first seven items are $3 per unit per year and for the last three items are $4. Identify the total costs of obtaining inventory and the total cost of keeping inventory for each item.

Required Elements of the ABC Assessment:

Create a Complete ABC analysis of the items in Jones' inventory found in the table.

Explain in detail how you arrived approached the application of the ABC assessment.

Make at least three recommendations as to how Jones might best manage the inventory of the items listed in the table. Explain in detail why these recommendations would prove a better means of controlling the inventory thereby saving the company money.

Required Elements of the EOQ Assessment:

Identify the total costs of obtaining inventory.

Identify the total cost of keeping inventory for each item.

Explain how this information will affect your recommendations made from the ABC analysis. If there is no change, why or why not?

What changes might Jones adopt to better manage their inventories?

Required Formatting of Supply Chain Trade-Off Assessment:

This report should be double spaced, 12-point font, and two pages in length excluding the title page and reference page;

Title page;

Third person writing is required. Third person means that there are no words such as “I, me, my, we, or us” (first person writing), nor is there use of “you or your” (second person writing). If uncertain how to write in the third person, view this link: http://www.quickanddirtytips.com/education/grammar/first-second-and-third-person;

Contractions are not used in business writing, so you are expected NOT to use contractions in writing this assignment.

Use APA formatting for in-text citations and reference page. You are expected to paraphrase and not use quotes. Deductions will be taken when quotes are used and found to be unnecessary;

The expectation is that you provide a robust use of the course readings. No other books besides the course eBook can be used. When using a source document, the expectation is that the information is cited and referenced with a page or paragraph number;

Course Readings Links:

https://www.tradegecko.com/learning-center/what-is-inventory-management

https://squareup.com/townsquare/how-to-do-effective-inventory-management-for-small-business

https://www.purchasing-procurement-center.com/abc-analysis.html

https://scm.ncsu.edu/scm-articles/article/economic-order-quantity-eoq-model-inventory-management-models-a-tutorial

https://www.youtube.com/watch?v=AYpjPWmlyHM

https://www.youtube.com/watch?v=2h7nOY2ICHA

https://www.shopkeep.com/blog/inventory-control-procedures

http://www.inventoryops.com/cycle_counting_and_physical_inventories.htm