Uil Inc. Case Study

Valleen Bacarisa X0B

Viewpoint

Jim Sinclair Materials Manager for UIL Inc.

Statement of the Problem

Large amount of time consumed and costly expenditures due to the processing of rush purchase orders.

Timeline

Before: Inventory Cages (eliminated several years ago)

Present: Centralized materials requisition system

Objective: Decide on whether to choose outsourcing as their new system or reimplement the method of having inventory cages in order to solve their problem.

Areas of Consideration

SWOT Analysis

* Strengths

--Manufacturing custom equipment for large variety of industries worldwide.

--Functioned as an independent profit center responsible for its own purchasing, manufacturing and sales function.

-- Their current system is centralized. They would arrange for their requisition through Jim. And then Jim will issue a purchase order to a supplier to receive delivery.

--Stocks are held in minimum-maximum range.

--Computer system to track the number of items in stock.

* Weaknesses

--Subsidiary of Marin Inc..

--Allocation of Capital to UIL from Marin on the basis of charging a levy on its bottom line based on percentage of capital utilized.

--Growth in the number of purchase order.

--Frequent stock outs.

-- Rush orders to restock the supply. These had become a significant porting of the POs issued and were consuming time.

* Opportunities

--Outsourcing

--Allow suppliers to manage and maintain inventory levels of the items in the three high-volume groups: MRO, Welding and Hardware.

--Suppliers that can offer the best quality and price.

--Inexpensive individual items in the Welding, Hardware and MRO(Maintenance/Repair/Operatiing)....