Casual Furniture Case

2. The 600 unit order of brackets being split into two order 300 units order to be delivered separately has no negative impact on production. The only difference this produces is that at the end of Week 1 CFC is holding 300 less brackets because of the order being split. By the end of Week 2 CFC has the same inventory of brackets on hand as it would if the brackets where ship all at once and from Week 3 onward the MRP is identical. It could be argued that having the order split in half was actually beneficial to CFC because it lowered their inventory holding costs.

3. The cutting department has a capacity of 24000 minutes of cutting time a week. Looking at the planned order releases for Week 1, I found that to meet these orders it would take the cutting department a total of 7240 minutes. This leaves the cutting assembly with about 16,760 minutes of excess capacity. Looking ahead, even during the weeks with the largest orders placed upon the cutting assembly, the department still has significant excess capacity. For this reason CFC should consider reduce the cutting department to only one worker.

4. If I could I would reduce the lead-time of the Cabinet to one week because this component takes the longest time to manufacture, making it the bottleneck of the entire process. Also the FOQ for the shelf should either be reduced or changed to L4L ordering styles. This is because a FOQ of 500 is much more than is ever required and by making shelves in batch of 500 it is wasting capacity that could be used more productively. Finally it would be ideal if CFC could order brackets in groups of 300. As question 1 demonstrated there are scenarios when ordering 300 would nto impact manufacturing and lower carring costs