LIBA

MUSICTODAY,LLC
A CASE SOLUTION
ABOUT THE CASE:
 Music Today deals with some merchandise goods such as CDs, T-Shirts, hats, posters
and stickers and also it sells some tickets to live events, built custom Internet stores.
 Due to the demand fluctuation musictoday faced Problems like frequent stock outs
during critical periods, varying replenishment quantities, varying demand.
 And thereby Musictoday has to make some inventory planning process that needs to be
better than the previous.
 And so we are implementing fixed period p system where the review period is fixed and
quantities will differ as per the target inventory level.
 Inventory management
- Determining a reorder point
- An initial target of 90 percent service level for all Night Train merchandise.
- Safety stock
- Need for formal order-cycle process (Periodic Review System)
- Lead time for all Night Train merchandise was 4 weeks besides CDs for which lead
time was 10 days or 1.5 weeks.
- Frequency of review : 4 Weeks.
- Order cost $100 and inventory carrying cost 15% of the price.
 So a periodic review system is recommended in order to minimize the stock outs.

CONCLUSION:

After implementing the fixed period p system for the first quarter the total number of orders
taken for all the merchandise is 6109+0+772+1788+0+251=8920 whereas in the old existing
system it was 13250. Here we not only reduce the order quantity size but also we have avoided
the stockouts completely which was the main problem faced by musictoday. Similarly the orders
for subseqent quarters can be found by repeating in the same way…