A house specialising in motor places located in Kalamazoo. Michigan. Discuss alterations in stock list and other cost since the recent enlargement of its market from the local Midwest to a national 1. The companies besides have to cover with another major job because it merely manufactures a few of it constituents while the others are purchased form outside sellers. In an effort to cut down component portion disbursals. the president of the company considers implementing the Just-in-time system in his house. The merely in clip is a system developed by Toyota designed to command quality develop provider and distributors’ relationship and minimise stock list.
1. What is the entire one-year cost of keeping the constituents stock list under the present system? Under the present system the entire cost to keep the constituent per twelvemonth is $ 1. 292824. 00 2. What would be the entire one-year cost of keeping the constituents under the JIT system ( Assuming no safety stocks ) ? The one-year cost of keeping the constituents under the JIT system would be 3. Should Ballenger take into history any other cost or benefits from JIT system?
if so what are they?
With the JIT system Ballenger would be less concern about keeping a big stock list and they would less likely to see shrinking. The just-in-time system will besides guarantee that parts are available to fabricate merchandises and will better function clients more efficaciously and expeditiously. 4. If the JIT system is adopted are at that place safety sticks of any point that should be maintained? If so which 1s and how much If JIT system is adopted DVD participants should be placed under capacity safety because they seem to be rather expensive. 5. If JIT system is adopted. what changes if any should happen in the relationships between Ballenger’s house and his providers of constituents? Discuss They would necessitate to be more watchful keen and subject in footings of bringing therefore the house and the provider would hold to keep good communicating accomplishments to avoid any defects.
6. Assume that Ballenger has switched to the JIT system and that he receives a surprise phone call from a rival who is traveling out of concern. The rival wants to sell Ballenger 7. 000 dome visible radiations of the type listed in Exhibit 2-A. Should Ballenger purchase them? If so. at what monetary value? I don’t think that Ballenger should buy these visible radiations because harmonizing to the JIT system one of its purpose is to transfuse subject and this therefore will destroy such vision non merely that but Ballenger would besides hold to see storage for these light bulbs. 7. Transporting cost are 20 per centum. Is at that place a degree of transporting cost at which both Ballenger’s nowadays system and a JIT system have similar cost what is that? There won’t be a degree when the two systems have the same cost but if so it would be at a highly high rate possible transcending 100 per centum.