Questions: Ruby-Star Incorporated is considering two different vendors for one of its top-selling products which has an average weekly demand of 30 units and is valued at 50 per unit. Inbound shipments from vendor 1 will average 330 units with an average lead time (including ordering delays and transit time) of 5 weeks. Inbound shipments from vendor 2 will average 460 units with an average lead time of 3 weeks. Ruby-Star operates 52 weeks per year; it carries a 5-week supply of inventory as safety stock and no anticipation inventory.

Ruby-Star Incorporated is considering two different vendors for one of its top-selling products which has an average weekly demand of 30 units and is valued at 50 per unit. Inbound shipments from vendor 1 will average 330 units with an average lead time (including ordering delays and transit time) of 5 weeks. Inbound shipments from vendor 2 will average 460 units with an average lead time of 3 weeks. Ruby-Star operates 52 weeks per year; it carries a 5-week supply of inventory as safety stock and no anticipation inventory.
Transcript text: Ruby-Star Incorporated is considering two different vendors for one of its top-selling products which has an average weekly demand of 30 units and is valued at $50 per unit. Inbound shipments from vendor 1 will average 330 units with an average lead time (including ordering delays and transit time) of 5 weeks. Inbound shipments from vendor 2 will average 460 units with an average lead time of 3 weeks. Ruby-Star operates 52 weeks per year; it carries a 5-week supply of inventory as safety stock and no anticipation inventory.
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Calculate the average aggregate inventory value of the product if Ruby-Star used vendor 1 exclusively.

Calculate the cycle stock.

The cycle stock is given by \( \text{Cycle Stock} = \frac{\text{Shipment Size}}{2} = \frac{330}{2} = 165 \) units.

Calculate the safety stock.

The safety stock is given by \( \text{Safety Stock} = \text{Weekly Demand} \times \text{Safety Stock Duration} = 30 \times 5 = 150 \) units.

Calculate the total inventory.

The total inventory is given by \( \text{Total Inventory} = \text{Cycle Stock} + \text{Safety Stock} = 165 + 150 = 315 \) units.

Calculate the aggregate inventory value.

The aggregate inventory value is given by \( \text{Aggregate Inventory Value} = \text{Total Inventory} \times \text{Unit Value} = 315 \times 50 = 15750 \).

The average aggregate inventory value of the product if Ruby-Star used vendor 1 exclusively is \\(\boxed{15750}\\).

The average aggregate inventory value of the product if Ruby-Star used vendor 1 exclusively is \\(\boxed{15750}\\).

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