A retail shopping chain decided to improve its customer service, productivity and reduce its transportation costs by shifting its existing central warehouse to a new location. For this purpose, the company collected data of its existing three retail shops as shown in Table - 1. Table-1 Sales Volume X and Y Coordinates Location (in Units) of the location Location -1 36 (8, 4) Location - I| 29 (4, 9) Location - III 15 (5, 5) Question-1: Evaluate the data in Table - 1 to arrive at the coordinates of new central warehouse which is supposed to be optimum and improve the productivity of this retail chain Explain all the steps.

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OPERATIONS MANAGEMENT
A retail shopping chain decided to improve its customer service, productivity and reduce its transportation costs by shifting its existing central warehouse to a new location. For this purpose, the
company collected data of its existing three retail shops as shown in Table 1.
Table-1
Sales Volume
X and Y Coordinates
Location
(in Units)
of the location
Location - 1
36
(8, 4)
Location – II
29
(4, 9)
Location IlI
15
(5, 5)
Question-1: Evaluate the data in Table - 1 to arrive at the coordinates of new central warehouse which is supposed to be optimum and improve the productivity of this retail chain
Explain all the steps.
A grocery shop based in UAE found that its inventory strategy of ordering the raw material is not appropriate. Due to this, the company's productivity has been consistently decreasing in the
recent past and the production also stopped many times due to the non-availability of raw material and increased the stock-out costs and total inventory cost. Therefore, the company decided to
reduce its total inventory cost to improve its productivity related to the operations. On an experimental basis, it studied the costs of inventory of one single item. The annual demand of this item
is found to be 2500 units. Its order cost is found to be 60 AED per order and the holding cost is calculated as ten percent of the ordering cost. The shop purchases its raw material for this item at a
cost of 80 AED.
Question-2: Evaluate the above data to recommend an operations strategy for ordering the items economically and find the total cost of inventory. Provide your suggestions Explain
all the steps and show the calculations.
Transcribed Image Text:OPERATIONS MANAGEMENT A retail shopping chain decided to improve its customer service, productivity and reduce its transportation costs by shifting its existing central warehouse to a new location. For this purpose, the company collected data of its existing three retail shops as shown in Table 1. Table-1 Sales Volume X and Y Coordinates Location (in Units) of the location Location - 1 36 (8, 4) Location – II 29 (4, 9) Location IlI 15 (5, 5) Question-1: Evaluate the data in Table - 1 to arrive at the coordinates of new central warehouse which is supposed to be optimum and improve the productivity of this retail chain Explain all the steps. A grocery shop based in UAE found that its inventory strategy of ordering the raw material is not appropriate. Due to this, the company's productivity has been consistently decreasing in the recent past and the production also stopped many times due to the non-availability of raw material and increased the stock-out costs and total inventory cost. Therefore, the company decided to reduce its total inventory cost to improve its productivity related to the operations. On an experimental basis, it studied the costs of inventory of one single item. The annual demand of this item is found to be 2500 units. Its order cost is found to be 60 AED per order and the holding cost is calculated as ten percent of the ordering cost. The shop purchases its raw material for this item at a cost of 80 AED. Question-2: Evaluate the above data to recommend an operations strategy for ordering the items economically and find the total cost of inventory. Provide your suggestions Explain all the steps and show the calculations.
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