Design for Supply Exercise

Design for Supply Exercise

Module 1 Session 11

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The Swift Company is manufacturer of Duros plastic table used mainly for outdoor use at cottage and so forth. The swift company has 160 kinds of different designs of Duros plastic table and are manufactured in two manufacturing plant

I. Main Plant where they receive and store raw materials from suppliers and mould table from plastic pellets, attach one of the eight type of footpads to each leg ,then one of the four types of trim is added and then these tables are stacked four high in truck and these semi finished tables are shipped to Swift's finishing plant which takes 90 minutes transit time

II. At Finishing plant the final process of gluing specified decorative top pattern and gluing backing of each table, final packaging is done and then plastic tables are shipped to their Finished goods warehouse where 10 units of each design is stocked i.e. 1600 units are stocked and thus delivery orders as received. Transit time from finishing plant to finished goods warehouse is again 90 minutes.

At Finished goods warehouse orders are unloaded from the truck and are again loaded in small vans and delivered to customers. It is necessary to deliver the products within two hours of order placed.

Currently, The Swift Company is facing three major problems:

I. Longer lead times

II. Higher cost in its supply chain

III. High cost of inventory

In order to overcome this issues instead of manufacturing Duros plastic table at two different facilities and then shipping finished products to their finished goods warehouse, Swift Company can consolidate its operations of manufacturing and storing at one location . This way the lead time of production can be reduced as each facility is at 90 minutes distance from each other. Moreover cost involved in transferring WIP inventory from one facility to another manufacturing facility and finished goods can be reduced as...