Supply Chain Management Midterm Exam Questions

To improve customer satisfaction while reducing operating expenses and inventory investment.

The amplification occurs due to: (1) Order batching – each tier rounds up orders to truckload quantities. (2) Price fluctuations – forward buying during discounts. (3) Rationing – if supply is short, customers over-order. Mitigation strategies: (a) Share point-of-sale (POS) data across all tiers. (b) Implement vendor-managed inventory (VMI).

needs to calculate the . He looks at his $185,000 inventory and applies a 25% cost factor. He also checks his Months of Stock to see how long his current supplies will last.