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This study's focus on two service companies that manage inventories is its primary contribution. The focus of the inquiry will be on Dollar Tree and Walmart's inventory management strategies. Inventory is the term for the items that a business keeps on hand for potential usage and sale. The majority of businesses are required to control their inventory through planning, coordinating, handling, and coordinating acquisitions. A manufacturing company's performance can be improved with the help of inventory, which is why it is so important. Utilizing its inventory, a company can create liquid cash that is a current asset. Inventory serves primarily as a tool for businesses to make financial savings.
Type of inventory that These companies manage and the characteristics of their inventory
Walmart Company and Dollar Tree use four distinct categories of inventories. The inventories include raw materials, repair, work in progress, maintenance, finished possessions an operating supply. It is the responsibility of a vendor to supply raw materials to an organization. Raw materials do not contain any labor. In addition, work in progress refers to any products that are at a differing stage of production. The other products which include operating supply, maintenance and repair refer to processes that are required so as to attain the task of operating the production process (Silver, 1981). After the course of production, an organization acquires complete goods which are prepared for the distribution process to the market. Both Dollar Tree and Walmart are similar to their inventory. The two organizations use raw materials, supplies and acquire finished goods after all the process of manufacture.
The main characteristic that is similar to Dollar Tree and Walmart is that the two organizations are involved in stock keeping. Stock refers to products that are safe in a specific location. The second characteristic of the two organizations is that they both possess the dependent and independent demand for materials. Dependent demand refers to the situation where one does not require to forecast on the outcome while on the other hand, the independent demand refers to a situation where the item does not depend on another to be forecasted. For instance, a television is an independent product since it does not rely on anything and hence it can be stated to be a finished product (Peterson & Silver, 1979). A DVD player is a dependent product since they rely on television to be used. The other characteristic of the two companies is that they contain stock out. Stock out simply means that the business does not contain anything that the client demands. A stock out results to loss of sales. A backorder is a situation where a customer opts to wait for products to be obtainable.
Analyze how every good and service design concept is integrated
The design concept of Dollar Tree and Walmart is a convenient good and service program. A convenient service and goods program assists in making the organization reliable with the customer care process. Dollar Tree service program, for instance, is efficient because it offers some digital coupons. The contribution of the online coupons demonstrates that the company has great care for the savings of the clients. Dollar Tree organization, therefore, assists its clients to have savings. Dollar Tree organization also allows its clients to operate 24/7 on daily basis (Stevenson & Hojati, 2007). The company ensures that its goods and services are available any time of the day. This makes them have a great combination where the clients can acquire any good they need anytime. On the other hand, Walmart also has improved goods and service design concept where a customer can make extended choices where they can make a choice From. For instance, a client can choose to shop online or even ship the goods to the closest Walmart. Walmart mainly wishes to have its product made in China. Dollar Tree, on the other hand, acquires its products mainly from America where its main manufacturers include Coca-Cola and Procter& Gamble.
Evaluate the role of Inventory in the performance of the Company, operational efficiency and customer satisfaction
Inventory is quite significant in any organization. In every business, inventory helps in generating profit and revenue. A company has the capability to generate revenue when they collect or sell an item at a great cost and this is how companies acquire their profit. Turnover helps a company to figure out its products to the customers. It is necessary to use proper inventory management so as to maximize the operational competence. Inventory is also necessary because it leads o improved satisfaction to the client in various ways. Some of the main items that result to the satisfaction of the client include in stock, returns, pricing, and fulfillment of time. The fulfillment of time means that one can fulfill any order using some good inventory control.
Inventory control also means that one has the capability to analyze the items being sold especially when the products are available in rewarding the order of the customers. A good inventory administration assists an organization to reduce the time that a product can spend on the shelves. Customers are happy to get the perfect information regarding a product (Peterson & Silver, 1979). Dollar Tree and Walmart organizations ensure that their clients are always satisfied with their products every time. The customers always have the desire to satisfy their customers in their business activities. The performance of a company can be influenced by lack of a purposeful inventory since it results in poor client services, loss of cost efficiency and poor planning. Poor inventory systems result to poor products to the client. Poor organizational planning can also affect the satisfaction of a client. It is necessary for an organization to plan ahead for some additional stock in case a store is out of stock before they ship new products. It is therefore effective for Dollar Tree and Walmart to make some future plans and ensure that they have enough stock to avoid the client complaints.
Compare and contrast 4 types of layouts with every organization and state the significance of the company’s layout
It is necessary for an organization to possess the perfect layout because this can influence the efficiency of the company. A proper layout assists in developing the company in the maintenance of the perfect flow of production as well as ensuring that the business is cost effective. The main types of layout that companies use include the fixed-position arrangement, development layout, cellular design and product outline. First, the process outline is quite significant in organizations that utilize low-volume products which need distinct procedures in operating. Some of the organizations that use this service include banks, hospitals, and libraries (Stevenson & Hojati, 2007). A process layout is quite significant because it is quite flexible. Most of the firms that use this layout process can flexibly take their processes in a cheaper process. The other advantage is that one does not have to rely on a single machine. The production process does not stop even when one machine fails. The disadvantage of using this process is that workers have to be hired because the procedure has some skills required. The other disadvantage is the utilization of low equipment and complex means of planning.
The next layout process is the fixed position which organizations use to make larger products like the ship, airplanes, and constructions. Fixed layout position requires people to gather materials and resources that are only used in completing the work. The disadvantage of using the fixed position layout is that they lack enough space for storage. The other disadvantage is that they contain less span of controlling the administered project. The product layout is the other thing needed in the operation of manufacturing goods as well as delivering services. Subway is one of the businesses that use this form of the layout (Silver, 1981). The main advantage of using this layout process is that there is the creation of larger spaces of production within a less period. The process is also cost effective since a higher volume of equipment as well as labor is utilized. The disadvantage of using this process is that there is less flexibility.
The final layout process is the Cellular layout which is based on a requirement process where there are similar products that need similar processing. An organization using this form of layout in supporting cellular manufacture. The process involves about 1-3 employees in every cell. The employees have to use some techniques so as to improve on the cell output. Every process is grouped into a cell. The advantage of using this process is that it is motivational, flexible and cost effective. The layout allows one to manufacture fewer batches hence making it flexible while working. Both Walmart and Dollar Tree does not use this kind of layouts (Peterson & Silver, 1979). Every retail shop prefers to use layouts that structure their products in a manner that can influence the sale of the items. Walmart for instances uses the service layout. The organization states that service layout offers better experience to the clients. The organization is, therefore, able to regulate its prices as well as allow less time for the clients to explore their shops. A customer can get anything they require easily.
Determine the metrics to evaluate the supply chain performance of the companies
A supply chain manager needs to use various metrics in the analysis of the performance of a firm. They should also clearly know the means of improving their operation and design of their supply chain. The main metrics are supply chain efficiency and client related measures. It is necessary to use these metrics so as to offer some competitive edges in a market. Dollar Tree, for instance, offers its clients a survey on every receipt. This can be termed as a supply chain efficiency that can assist an organization to maintain its inventory at the top. I would suggest that Dollar Tree aims at creating products on lock boxes (Stevenson & Hojati, 2007). Dollar Tree should go through the list of products they bring to their customers to prevent any damage of unnecessary products.
Walmart, on the other hand, uses the sustainability and responsiveness metrics. The organization is distinct in how it avails its products on stock. The organization offers clients with the opportunity to shop online where they obtain similar products. They also ensure that the clients can ship their products to stores located at their homes through email address (Silver, 1981). They ensure that the client gets the product when it is needed. Walmart also uses the sustainability metric in assisting the suppliers as well as retailers to collaborate. This process is helpful in improving product sustainability which can favor customers. The organization aims at improving the product quality and gaining customer trust in every product that they transport. Walmart has embarked on improving the utilization of the metric. I would suggest Walmart aim at cleaning the environment by removing every waste product that is a pollutant.
State the ways of improving the Inventory management of every organization without influencing the operation of the company
Dollar Tree and Walmart are great companies that are keen in handling their inventory. The companies acquire shipments but they contain empty shelves especially when they fail to receive their products. In order to improve the management of the inventory, the companies ought to break their operational inventory into different categories that include replenishment, safety and excess stock which helps them to understand their inventory. The company acquires the ability to make straight forward decisions as well as understand the safety stock required. Dollar Tree experiences trouble when they acquire what they already contain. The organization, therefore, has to put the extra stock on the top storage. The extra inventory should be taken to the manufacturing organization and explain to them what is lacking and what is present. It is necessary for the organization to keep its stock safe so that they can save cash and avoid wastage. An organization can also improve on its inventory by writing down the records and ensuring that the inventory is of high quality that they can rely on in future.
Peterson, R., & Silver, E. A. (1979). Decision systems for inventory management and production planning (pp. 799-799). New York: Wiley.
Stevenson, W. J., & Hojati, M. (2007). Operations management (Vol. 8). Boston: McGraw-Hill/Irwin.
Silver, E. A. (1981). Operations research in inventory management: A review and critique. Operations Research, 29(4), 628-645.
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