Inventory Aggregation
For this assignment, create an Excel spreadsheet to evaluate the two options. The comparison should compare: (a) the annual holding cost of safety stock for the “no aggregation” option, where all 40 final product configurations are held in inventory, and (b) the annual holding cost of safety stock plus the increased printing cost for the “aggregation” option, where inventory is held by color so that only 5 different items are held in inventory. When analyzing the two alternatives, use a target product fill rate of 99%. After explaining inventory holding costs to Jane, you agree to use an annual holding rate of 35% for your analysis because jane will need to rent warehouse space. However, this value is uncertain. So, you agree to use a graphical display to show her how the options compare if the annual holding rate is changed over a range from 15% to 50%. The assessment of this work will be based on the accuracy and clarity of your spreadsheet and the graph
Leave a Reply
Want to join the discussion?Feel free to contribute!