ur new business idea, product, or service using notional demand and inventory da
ID: 421128 • Letter: U
Question
ur new business idea, product, or service using notional demand and inventory data. This initial production plan s based on your market estimates of what you intend to sell and produce. The final paper is managing the project to implement your intended new product/service into the marketplace, but you have to create a production plan that is supported by your market forecasts, and that is the purpose of this assignment. Prompt: The plan should replicate the techniques in the text and can be submitted in a basic tabular (spreadsheet) format. It must include the following: .Estimates of labor hours consumed Estimated number of worker requirements considering a standard work week, current inventory levels, receipts of new inventory during each month, a varying demand levels for each month of production For service businesses that do not include inventory or raw goods for the assembly line, the inventory of the support materials/equipment or consumable materials can be used Specifically, the following critical elements must be addressed: Create a semiannual production plan using notional demand and inventory. Estimate the labor hours consumed. Estimate the number of worker requirements considering a standard work week, current inventory levels, receipts of new inventory during each ma and varying demand levels for each month of production.Explanation / Answer
Production is the most important activity of an organisation. A production plan is a plan which outlines how manufacturing of product is planned within the organisation. It details out the number human resource, raw materials, machines, cost required to product a product. A production plan can be created annually or semi-annually.
A semi-annual production plan for Apple Inc deciding to expand in China is tabulated below:
Beginning Inventory
2500
Beginning Workforce
18
Labor Standard (units/worker)
250
Costs
Cost Per Unit
Total Units
Total Cost
Regular Time Labor Cost
$9.60
28000
$2,68,800
Overtime/Subcontracting
$14.40
0
$0
Inventory Holding Cost
$5.00
2750
$13,750
Backorders
$7.50
0
$0
Hiring
$500.00
28
$14,000
Layoff
$750.00
12
$9,000
Total Costs
$3,05,550
Period (months)
1
2
3
4
5
6
Demand
3000
6000
2000
1500
4000
5500
Cumulative Demand
3000
9000
11000
12500
16500
22000
Net Cumulative Demand
500
6500
8500
10000
14000
19500
Production/Inventory Planning
Production
3250
3250
2000
1500
4000
5500
Cumulative Production
3250
6500
8500
10000
14000
19500
Inventory (Excess Units)
2750
0
0
0
0
0
Backorders (Units Short)
0
0
0
0
0
0
Capacity Planning
Workers Hired
0
0
0
0
10
6
Workers Layed Off
5
0
5
2
0
0
Workforce Available
13
13
8
6
16
22
Regular Time Capacity (units)
3250
3250
2000
1500
4000
5500
Overtime/Subcontracting (units)
0
0
0
0
0
0
Total Production Capacity (units)
3250
3250
2000
1500
4000
5500
Beginning Inventory
2500
Beginning Workforce
18
Labor Standard (units/worker)
250
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