Just-in-Time Kalamazoo

SCLT 2361- Introduction to Logistics Technology

Case Study 2-1

“Just-in-Time Kalamazoo”

Introduction

This case compares two types of systems used as an approach to inventory. The two different types are the JIT (Just-in-Time) System and the current system that is being used by Jim Ballenger for his mini motor home firm. The data and information in this case help see all pros and cons for both systems to see which system, in the long run, would be more cost efficient and more reliable for the members.

Current System

(Total Inventory maintenance cost per year = $1,151,522.00)

Item | Average distance from vendor (in miles) | Number of units used each week | Current lot size purchased | Unit cost | Average freight cost per unit |

Gas range | 1,145 | 10 | 200 | $100 | $20 |

Toilet | 606 | 10 | 240 | $80 | $18 |

Pump | 26 | 56 | 125 | $16 | $3 |

Refrigerator (large) | 22 | 6 | 120 | $110 | $20 |

Refrigerator (small) | 22 | 7 | 15 | $95 | $15 |

Foam cushion | 490 | 675 | 1,500 | $8 | $2 |

CB radio(type D) | 1,800 | 9 | 24 | $136 | $11 |

Dome lights | 3 | 824 | 1,720 | $2 | None |

Awning bracket | 48 | 540 | 1,200 | $4 | $1 |

Insect screen | 159 | 570 | 1,240 | $7 | $1 |

Current System (continued)

Item | Safety stock | Average inventory | Total inventory | Inventory cost | Inventory carrying charges | Inventory maintenance cost |

Gas range | 40 | 100 | 140 | $62,400 | $3,360 | $65,760 |

Toilet | 40 | 120 | 160 | $50,960 | $3,136 | $54,096 |

Pump | 56 | 63 | 119 | $55,328 | $450 | $55,778 |

Refrigerator (large) | 6 | 60 | 66 | $40,560 | $1,716 | $42,276 |

Refrigerator (small) | 7 | 8 | 15 | $40,040 | $319 | $40,359 |

Foam cushion | 1,350 | 750 | 2,100 | $351,000 | $4,200 | $355,200 |

CB radio (type D) | 36 | 12 | 48 | $68,796 | $1,411 | $70,207 |

Dome lights | 824 | 860 | 1,684 | $85,696 | $674 | $86,370 |

Awning bracket | 540 | 600 | 1,140 | $140,400 | $1,140 | $141,540 |

Insect screen | 1,140 | 620 | 1,760 |...