Production Essay

742 words - 3 pages

1. How could a grocery store use inventory to increase the responsiveness of the company’s supply chain?

The logistical driver of inventory encompasses all raw materials, work in process, and finished goods within a supply chain. A grocery store can be more responsive if it offers a broader variety. A grocery store should use products that can last for a significant amount of time and does not hold a high demand in its current time.

2. How could an auto manufacturer use transportation to increase the efficiency of its supply chain?

An auto manufacturer could pick either a quick transportation with a high cost or a slow transportation with a lower cost by knowing the reorder level ...view middle of the document...

Motorola was willing to give up some control and possibly some of its design talent and assembly expertise because it felt that the supplier could provide product of an appropriate level of quality with the responsiveness necessary. Products and services that are outsourced are rarely brought back in-house and should never be tied too closely to the outsourcing party’s core competency.

6. How can a home delivery company like Peapod use pricing of its delivery services to improve its profitability?

Peapod can use everyday low pricing of its products to ensure stability in the supply chain, but can influence demand by varying the delivery charges. For example, by establishing a minimum order amount of $50 and charging $10 to deliver an order under $75, Peapod provides an incentive for a customer to pile on additional items to save on per unit shipping. An order over $100 incurs a delivery fee of $7, which is the lowest delivery charge for a residential customer.
Peapod also varies delivery charges by time of day; evening delivery times on weekdays and morning deliveries on Sunday within narrow windows cost an extra dollar, wider delivery windows are $1 less. The delivery latitude allows Peapod’s delivery drivers to schedule more efficiently thereby increasing profitability.

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