Problem Assignment

1) Analyze the Walmart’s Annual report 2023. Highlight the supply chain drivers,
inventories, suppliers, and various metrics in your analysis.

2) Target purchases home goods made by a supplier in China. Target’s stores in the United
States sell 200,000 units of home goods each month. Each unit costs $10 and the company
has an annual holding cost of 20 percent. Placing a replenishment order incurs clerical costs
of $500/order. The shipping company charges $5,000 as a fixed cost per shipment along
with a variable cost of $0.10 per unit shipped. What is the optimal order size for Target?
What is the annual holding cost of the optimal policy? How many orders per year does
Target place? What is the annual fixed transportation cost? What is the annual variable
transportation cost? What is the annual clerical cost?
3) Amazon sells 20,000 units of consumer electronics from Samsung every month. Each unit
costs $100 and Amazon has a holding cost of 20 percent. The fixed clerical and
transportation cost for each order Amazon places with Samsung is $4,000. What is the
optimal size of the order that Amazon should place with Samsung? With the goal of
reducing inventories, Amazon would like to reduce the size of each order it places with
Samsung to 2,500 units (allowing it to get four replenishment orders every month). How
much should it reduce the fixed cost per order for an order of 2,500 units to be optimal?
4) An automobile company has two contract manufacturers for its electronics components in
Asia. Roxconn assembles its music systems while Tlextronics assembles its control panels.
Monthly demand for music systems is 10,000 units while that for control panels is 4,000.
music systems cost the company $100 while control panels cost $400 and the company has
a holding cost of 25 percent. Currently the company has to place separate orders with
Roxconn and Tlextronics and receives separate shipments. The fixed cost of each shipment
is $10,000. What is the optimal order size and order frequency with each of Roxconn and
Tlextronics? The company is thinking of combining all assembly with the same contract
manufacturer. This will allow for a single shipment of all products from Asia. If the fixed
cost of each shipment remains $10,000, what is the optimal order frequency and order size
from the combined orders? How much reduction in cycle inventory can the company
expect as a result of combining orders and shipments?