Economics

MT435 Unit eight

Kaplan University

06/11/2013

Introduction

Albatross Anchor is a small family owned business that began in 1976 with four family members. Albatross anchor has grown exponentially and now employs one hundred and thirty people. Their one location/facility is situated on twelve acres of land located in a rural suburb of Small-town, USA. The manufacturing plant and the main office are located in the same building with the manufacturing. The administrative offices are in the front of the building and the manufacturing area is in the back of the building.

Question one

Challenge one: Supply Chain Management

Albatross anchor does not have sufficient space for raw material and finished goods and the lead time for the supply of its goods to its customers is high so in order to overcome the resulting disadvantages, it should improve its communication and relationship with its supplier of raw material and with its customer.

This could be done through smooth flow of information related to stocks, its availability and shipping details etc.

Challenge two: Cost Management

Cost Management means management of cost related activities achieved by collecting, analyzing, evaluating, and reporting cost information used for budgeting, estimating, forecasting, and monitoring costs.

Albatross anchor currently manufacturing high cost anchors. It should effectively reduce its cost in the following ways: Cutting corners is a way to cut costs in production or service methods. Some owners feel that by using cheaper materials and sometimes workers, and by selecting a lesser quality, they can cut costs and save money. Also they should get quality from suppliers, low quality suppliers are often a major source of waste. Businesses should not only try to get quality suppliers but also work with them to help improve their operations and quality of output. If you want to make sure you get a quality product, it is sometimes necessary to help your suppliers continuously...