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Question-1- Please read the scenario below and answer the questions. The maximum word-count limit of Enter question
each answer is 200 words. Mention separate heading for each part. (Marks-10) Controlling inventory is one
of Wheeled Coach’s toughest problems. Operating according to a strategy of mass customization and
responsiveness, management knows that success is dependent on tight inventory control. Anything else
results in an inability to deliver promptly, chaos on the assembly line, and a huge inventory investment.
Wheeled Coach nds that almost 50% of the cost of every ambulance it manufactures is purchased Continue to post
materials. A large proportion of that 50% is in chassis (purchased from Ford), aluminum (from Reynolds
14 questions remaining
Metal), and plywood used for ooring and cabinetry construction (from local suppliers). Wheeled Coach
tracks these A inventory items quite carefully, maintaining tight security/control and ordering carefully so as
to maximize quantity discounts while minimizing on-hand stock. Because of long lead times and
scheduling needs at Reynolds, aluminum must actually be ordered as much as 8 months in advance. In a
crowded ambulance industry in which it is the only giant, its 45 competitors don’t have the purchasing Snap a photo from you
power to draw the same discounts as Wheeled Coach. But this competitive cost advantage cannot be phone to post a questio
taken lightly, according to President Bob Collins. “Cycle counting in our stockrooms is critical. No part can We'll send you a one-time do
leave the locked stockrooms without appearing on a bill of materials.” Accurate bills of material (BOM) are a link
requirement if products are going to be built on time. Additionally, because of the custom nature of each
vehicle, most orders are won only after a bidding process. Accurate BOMs are critical to cost estimation By providing your phone number, you agree to receiv
automated text message with a link to get the app. St
and the resulting bid. For these reasons, Collins was emphatic that Wheeled Coach maintain outstanding messaging rates may apply.
inventory control.
• Enlist direct and indirect demands given in the scenario.
• Identify the current inventory counting practice and its importance to Wheeled Coach’s business. •
Implement ABC inventory control system. Develop ABC matrix to support your answer. My Textbook Solutions
• If you were the inventory control manager, what steps would you recommend for inventory record
accuracy? Your answer must analyze the drawback in prevailing system.

Expert Answer
Calculus Engineering Techn
Multivariable Mechanics -... Grap
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2. The inventory counting practice used in the above case is cycle counting inventory technique. Cycle
counting is a sampling technique where the count of a certain number of items infers the count for the
whole warehouse.When a cycle count is performed, there are two inferences that are made. The primary
inference is that the accuracy of the items in the cycle count can be used to determine the accuracy of the
items in the warehouse as a whole.

3. High Value items such as truck chassis, aluminium plates for panels and plywood which together
constitute 70% to 80% by value of purchase items are classi ed as A category items. Such items which may
constitute only 15% in terms of numbers, are closely monitored and cycle counting is carried out weekly.

4. As an inventory control manager at wheeleed Coach the steps that would be taken are, Do ABC analysis
and implement tight physical control of the stockroom.

Also, implement a cycle counting system, and ensure that issues require engineering changes notices for
those items not initially included on the bill of material. To the extent feasible, stockrooms would be
consolidated.

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