Supply Chain Test 1
Estimate the cost of a stock-out if the margin for the retailer is $1 and half of the time the customer switches brands and the other half of the time the customer doesn't buy.
$.50
Estimate the cost of a stock-out if the margin for the retailer is $1 and 25% of the time customer simply switches brand but 75% of the time they don't buy anything
$.75
Estimate the cost of a stock-out if the margin for the retailer is $1 and 25% of the time the customer doesn't buy anything but 75% of the time they simply buy another brand
$.75
Using the data from question 6, create a forecast for period 5 using Exponential Smoothing with an alpha of .5
50
Using the data from question 1, create a forecast for period 3 using Exponential Smoothing with an alpha of .4
500 - 500 = 0 * .4 = 0 490 - 500 = 10 * .4 = 4 500 - 4 = 496
Using the data from question 1, create a forecast for period 3 using Exponential Smoothing with an alpha of .8
500 - 500 = 0 * .8 = 0 490 - 500 = 10 * .8 = 8 500 - 8 = 492
Using the data from question 6, create a forecast for period 5 using Exponential Smoothing with an alpha of .2
52
Using the data from question 6, create a forecast for period 4 using (5,5).
54
Using the data from question 1, create a forecast for period 5 using (5,3,2).
550 * 5 = 2750 650 * 3 = 1950 490 * 2 = 980 ------------------ 10 5680 5680 / 10 = 568
Use the following for questions 1-5: Period Demand 1 500 2 490 3 650 4 550 5 575 6 Using a Weighted Moving Average (4,3,2,1), create a forecast for period 6.
575 * 4 = 2300 550 * 3 = 1650 650 * 2 = 1300 490 * 1 = 490 ------------------ 10 5740 5740 / 10 = 547
Use the following for the next 5 questions : Period Demand 1 50 2 65 3 42 4 57 5 75 6 Using the above data, create a forecast for period 6 using (4,3).
75 * 4 = 300 57 * 3 = 171 ---------------- 7 471 471 / 7 = 67
With a product that has a mean demand of 50 with a standard deviation of 10, if the seller hold 60 units in stock, what would the customer service level be?
About 84%
With a product that has a mean demand of 50 with a standard deviation of 10, if the seller hold 80 units in stock, what would the customer service level be?
About 99%
A SKU has a demand of 5 everyday but every 4th day, it is out of stock. What is the SKU's Item Fill Rate?
All # of items in stock / Total # of items in category = PIIS 15/20 = 75%
If an item is in stock for 10 days and then out of stock for 2 days, what is the item's Percent of Time in Stock?
All # of items in stock / Total # of items in category = PIIS 10/12 = .83 = 83%
If an item is in stock for 3 days and then out of stock for 3 days, what is the item's Percent of Time in Stock?
All # of items in stock / Total # of items in category = PIIS 3 / 6 = .50 = 50%
Which of the following are considered customer service targets?
All of the above (% of item in stock, % of demand fulfilled, % of time in stock)
Which of the following is something customers can do when faced with an out-of-stock?
All of the above (drop everything and go to another store, purchase a different brand, wait until the next shopping trip to buy the item)
A new DC can affect ROA by
All of the above (increasing the asset portion of the ROA equation, lowering the outbound costs which increases the profit portion of the ROA equation, increasing the inbound cost which decrease the profit portion of the ROA equation)
Processes are defined as
An ordered set of activities and information flow
If we sold 500 units in a year had an average inventory of 100 units, what was our inventory turns
Annual Sales / Average Inventory = Inventory Turns 500 / 100 = 5
Outsourcing can be described as
Any activity or set of activities that us handed over to a third party
The constant difference (higher or lower) between actual demand and forecast demand is called what? It can also be found using the running sum of the forecasting error and the mean forecast error
Bias
Using the data from question 6, create a forecast for period 4 using a 2-Period Moving Average.
Demand of Periods / # of Periods (65 + 42) / 2 = 53.5 = 54
Using the data from question 1, create a forecast for period 6 using a 3-Period Moving Average.
Demand of Periods 5, 3, 2 / # of Periods (650 + 550 + 575) / 3 = 592
The difference between the actual demand and the forecast is called the
Error
An example of Process Design would be
Have the supplier do the forecast rather than doing it yourself
The percent of demand filled from on-hand inventory is called
Item Fill Rate
An example of the Qualitative Method of forecasting is
Jury of Executive Opinion
Walmart focused on rural areas because
Land is cheaper in rural areas
The time between the initiation and completion of a process is known as
Lead Time
The difference between the lead time and the customer's order cycle is called
Lead Time Gap
Management of the flows and storage of inventory so that the total cost is minimized and customer service targets are achieved is the definition of
Logistics
Which of the following sentences are correct?
Logistics helps integrate business processes to manage the trade-offs between total costs and customer service
How much the forecast deviates from the actual observations is called what? It can be found by using MAPE and SDFE
Magnitude
We can use this metric to see the magnitude of our forecast error
Mean Absolute Percent Error
The time over which companies must make demand projections is called the
Planning Horizons
Walmart used SCM to create competitive advantage by
Putting stores close to distribution centers
Being able to change logistics and SCM activities quickly is which of 4R's?
Responsiveness
Which of the following Inventory Holding Costs refers to the cost associated with the chances of a product being stolen?
Risk
We can use this metric to see how much bias is in our forecast
Running Sum of Forecast Error
The expected number of units on hand just before a replenishment is received and available for use or sale is referred to as
Safety Stock
Which of the following Inventory Holding Costs refers to the cost associated with return on investment in inventory?
Space
Walmart would wait to expand geographically until
The current markets they occupied are saturated
"Many other costs outside the acquisition cost" describes
The total cost of ownership
The customer service component that is concerned with percent of items in stock, percent of time an item is in stock, order fill rates, lead times, etc., is
Transaction
Cost specific to Logistics can include
Transportation cost, inventory holding cost, warehousing and procurement
If we sold 1,000 units in a year, had an average inventory of 100 units, and were open 260 days a year, how many days of supply would we have?
Unit Sales / Monitory Turns 1000 / 100 = 10 Turn into fraction 1/10 yrs of supply Yrs of supply * Days open a year = Days of supply 1/10 * 260 = 26
Use the data below for the next three questions Forecast X Forecast Y Forecast Z RSFE -462. 29 -459 MFE -154 9.7 -153 MAPE 13.1 13 12.7 SDFE 24.6 23.4 21.1 Which of the three forecasts has the largest magnitude?
X
Use the data below for the next three questions Forecast X Forecast Y Forecast Z RSFE -462. 29 -459 MFE -154 9.7 -153 MAPE 13.1 13 12.7 SDFE 24.6 23.4 21.1 Using the data from question 16, which one of the three seems to have forecasts that are consistently lower than actual demand?
Y
Use the data below for the next three questions Forecast X Forecast Y Forecast Z RSFE -462. 29 -459 MFE -154 9.7 -153 MAPE 13.1 13 12.7 SDFE 24.6 23.4 21.1 Which one of the three forecasts has the least amount of bias?
Y
Process Redesign
is concerned with improving performance by changing the order of activities or fundamentally changing the activities themselves
