THREE JAYS

CORPORATION
CASE DATA ANALYSIS
Group Number: Team 8
Group Name: Afaq Zaim

COMPARISON OF OLD AND NEW EOQ (WITH UPDATED COSTS)

T EOQ USING EXISTING METHOD (USING 2010 SALES DATA AND DATA GIVEN IN
EXHIBIT 2)

PRODUCT (12 OZ) 3JS MARRAN KERRY DOM AAA

SALES/WK 57.56 44.9 28.69 17.04 12.02

S=SETUP COST 63.7 63.7 63.7 63.7 63.7
D=ANNUAL DEMAND (CASES) 2993 2335 1492 886 625
I=CARRYING COST 2.5506 2.7468 2.4174 2.6109 1.647
C=FULL COST/CASE 0.00946876 0.0130706 0.018002681 0.032742664 0.042112
EOQ (OLD) 387 329 280 208 220
ROP (3 WEEKS) 173 135 86 51 36
T EOQ USING EXISTING METHOD (USING 2012 SALES DATA AND DATA GIVEN IN
EXHIBIT 2)

PRODUCT (12 OZ) 3JS MARRAN KERRY DOM AAA

SALES/WK 74.4 57.81 37.88 23.29 16

S=SETUP COST 63.7 63.7 63.7 63.7 63.7
D=ANNUAL DEMAND (CASES) 3869 3006 1970 1211 832
I=CARRYING COST 2.55 2.75 2.42 2.61 1.65
C=FULL COST/CASE 0.00732 0.01015 0.010465 0.02396 0.03163
EOQ (OLD) 440 373 322 243 253
ROP (3 WEEKS) 223 173 114 70 48
% INCREASE IN SALES 29.26% 28.75% 32.03% 36.68% 33.11%
% INCREASE IN EOQ 13.71% 13.40% 14.85% 16.93% 15.27%

T EOQ USING RECOMMENDED COSTS AND 2012 SALES DATA

PRODUCT (12 OZ) 3JS MARRAN KERRY DOM AAA

SALES/WK 74.4 57.81 37.88 23.29 16

S=SETUP COST 37.5 37.5 37.5 37.5 37.5
D=ANNUAL DEMAND (CASES) 3869 3006 1970 1211 832
I=CARRYING COST 0.23 0.23 0.23 0.23 0.23
C=FULL COST/CASE 25.79 27.97 24.31 24.46 23.77
EOQ (OLD) 221 187 163 127 107
ROP (3 WEEKS) 223 173 114 70 48
% INCREASE IN SALES 29% 29% 32% 37% 33%
% INCREASE IN EOQ -43% -43% -42% -39% -51%
ROP (4 WEEKS) 298 231 152 93 64

WHAT IS THE IMPACT OF SETUP COSTS AND CARRYING COSTS ON EOQ? MENTION IN 1 LINE
The change in setup cost and carrying cost has led to a decrease in EOQ of the company