Obermeyer Case

Sport OBERMEYER Inaccurate forecasts of retailer demand had become a growing problem at Obermeyer: in recent years greater product variety and more intense competition had made accurate predictions increasingly difficult. Because of the uncertain demand Obermeyer has been and is still faced with, Wally should choose those styles for which they have experienced successes in the past, and have the most certain demand. In any way, Obermeyer should strive for reducing the uncertainty in the demand for their styles. Obermeyer can do this by the following: Examining the demand of previous years indicated that the accuracy about the forecast of retailer demand was highest for those styles in which the members of the Buying Committee had the highest level of agreement. When using table 3.19, in which these individual forecasts of the Buying Committee can be determined, we could be looking at the standard deviation. The Standard deviation tells us the spread among the agreements, implying that the lower the standard deviation, the higher is the agreement. Also the Las Vegas Show every year provides additional information to the design process for the styles. Obermeyer annually receives orders representing eighty percent of its annual volume in the week after the big show. Also the manufacturing lead time plays a crucial role in manufacturing processes. Every style needs different materials from different suppliers and a different manufacturing process. These lead times of each style is different and plays an important role in choosing the types and the amounts to order. One specific style can be a major success, but if the fabric or manufacturing process has a long lead time, this product is not lucrative anymore. Also this could imply major procurement and/or manufacturing costs, assuming that each style has different production and ordering costs due the difference in materials, hours spent manufacturing the products, locations etc. It can be assumed that the European...