EBK OM
6th Edition
ISBN: 9781305888210
Author: Collier
Publisher: YUZU
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Chapter 13, Problem 1DQ
Summary Introduction
Interpretation:
A good or service providing organization which make aggregate planning decisions.
Concept Introduction:
A good producing organization refers to the company which produce and manufacture product to fulfil the demand of the end consumer. A service-providing organization refers to the company which provide services to the end-consumer by satisfying the needs or want.
Expert Solution & Answer
Explanation of Solution
S is the company which manufactures stainless steel utensils and cutlery. They started their export with merchandise exporting and slowly they began to setup in-house manufacturing unit. The export takes place across different parts of the world majorly USA and Europe. S has a unique pricing strategy which revolves around 1%, 7% and 14% margin model. This means they operate at a very low margin which helps them to attract more customers. The promotion and advertisement is mainly through social media and cold emailing. There are fixed labours in the factory so hiring and firing does not take place and there are no subcontractors needed for the production. They hold inventory for just two to three days and then transport it to customer through sea shipment.
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Students have asked these similar questions
Why do operations planning require that a forecast be expressed in terms of physical units for an individual goods and services?
Palisades Eco-Park is a small ecological reserve that admits a relatively small number of visitors on any day, but provides both educational and entertaining lectures, exhibitions, and opportunities to observe nature. The company has collected the following data on labor costs and number of visitors to the park over the last 30 months.
Month
Labor Cost
Visitors
1
$
26,720
2,600
2
$
37,555
3,964
3
$
41,361
4,299
4
$
32,751
3,398
5
$
36,022
3,630
6
$
33,811
3,336
7
$
33,139
3,372
8
$
39,671
4,093
9
$
39,912
4,222
10
$
48,568
5,463
11
$
43,627
4,551
12
$
40,390
4,289
13
$
35,644
3,694
14
$
34,330
3,573
15
$
38,260
3,836
16
$
27,424
3,210
17
$
31,732
5,195
18
$
31,005
4,260
19
$
28,552
3,689
20
$
31,049
4,546
21
$
26,588
3,058
22
$
25,515
2,744
23
$
29,899
4,997
24
$
31,204
5,838
25
$
29,099
3,964
26
$
32,795
5,007
27
$
29,650
4,572
28
$
30,970
4,665
29
$
29,429
3,841
30
$
28,846
3,174
Required:
a. Estimate the labor…
Explain the concept of demand forecasting and its role in operations planning.
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