Find the weekly quantities demanded by the retailer

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Reference no: EM131942316

A retail home supply chain forecasts the following sales of wheelbarrows over the upcoming 8 weeks. It will purchase them from a wholesale firm, which in turn will buy them from a manufacturer.

Each firm's inventory policy is to maintain a safety stock (ending inventory) equal to its most recent week's demand.

Assume each firm begins with 400 units of starting inventory.

Week	Retail Sales Qdr
1	400
2	390
3	450
4	510
5	610
6	470
7	420
8	410

a. Find the weekly quantities demanded by the retailer from the wholesaler (Qdw), and by the wholesaler from the manufacturer (Qdm). Assume each firm starts in week 1 with a beginning inventory of 400 units.

b. Did either the retailer or the wholesaler have excess inventory, and if so, how much and in what week(s)?

c. Find the mean, standard dev. and coefficient of variation for Qdr, Qdw and Qdm. What do you conclude about the variability of demand for these firms? What is this pattern called?

d. Briefly explain how the bullwhip effect relates to an industry's inventory/sales ratio. You can use our numerical example above as an illustration.

What is the likely cause of the pattern that you see here?

As of the most recent date shown, (Dec 2016 on the day I looked) what is the current (seasonally adjusted) inventory/sales ratio for these 4 categories of goods: 441 Motor Vehicles, 442,3 Furniture (and related items); 445 Food and Beverage stores; and 448 Clothing? Why do you think these ratios differ by industry?

NAICS Code	Kind of Business	Sales			Inventorie			Percent Change In Inventories			Inventories/Sales Ratios
NAICS Code	Kind of Business	Dec. 2016 ID)	Nov. 2016 (0	Dec. 2015 (r)	Dec. 2016 U0	Nov. 2016 (0	Dec. 2015 (r)	Dec. 16/ Nov. 16	Nov. 16/ Oct. 16	Dec. 16/ Dec. 15	Dec. 16 (o)	Nov. 16 (r)	Dn. 15 (I)
	Adjusted'
	Retail trade. total............................................	415.242	410.174	396.893	609.010	608.687	588.432	0.1	0.9	3.5	1.47	1.48	1.48
	Total (excl. motor veh. & parts)........................	315.891	313.906	304.346	395.719	394.198	390.279	0.4	0.5	1.4	1.25	1.26	1.28
441	Motor vehicle di parts dealers..................................	99.351	96.268	92.547	213.291	214.489	198.153	-0.6	1.6	7.6	2.15	2.23	2.14
442.3	Furniture.home furn.. elect. di appl. stores................	17.222	17.390	17.458	26.795	26.883	27.352	-0.3	0.1	-2.0	1.56	1.55	1.57
444	Budding materials, garden equip & supplies.............	30.198	29.838	29.201	54.944	54.770	52.392	0.3	1.0	4.9	1.82	1.84	1.79
445	Food & beverage stores........................................	59.249	59.379	57.848	46.225	45.866	44.920	0.8	0.4	2.9	0.78	0.77	0.78
448	Clothing di clothing access. stores............................	21.481	21.458	21.224	54.209	54.050	53.765	0.3	0.8	0.8	2.52	2.52	2.53
452	General merchandise stores...................................	55.300	55.522	56.821	80.809	80.629	82.378	0.2	0.3	-1.9	1.46	1.45	1.45
4521	Dept. strs. (excl. leased depts.)..........................	12.591	12.665	13.754	26.997	26.955	28.567	0.2	-0.1	-5.5	2.14	2.13	2.08
	Not Adjusted
	Retail trade. total..............................................	484.678	415.243	463.668	602.475	640.946	581.931	-6.0	1.7	3.5	1.24	1.54	1.26
	Total (excl. motor veh. di parts)........................	385.105	326.439	371.352	386.537	422.579	380.982	-8.5	1.0	1.5	1.00	1.29	1.03
441	Motor vehicle & parts dealers.................................	99.573	88.804	92.316	215.938	218.367	200.949	-1.1	3.1	7.5	2.17	2.46	2.18
442.3	Furniture.home furn.. elect. & appl. stores................	23.334	19.876	23.695	27.036	30.754	27.626	-12.1	5.6	-2.1	1.16	1.55	1.17
444	Building materials, garden equip di supplies...............	27.522	29.053	27.044	52.032	53.072	49.615	-2.0	-0.8	4.9	1.89	1.83	1.83
445	Food & beverage stores........................................	65.048	59.290	62.673	46.867	48.071	45.558	-2.5	1.8	2.9	0.72	0.81	0.73
448	Clothing & clothing access. stores............................	34.333	23.438	33.123	51.119	58.320	50.647	-12.3	0.5	0.9	1.49	2.49	1.53
452	General merchandise stores...................................	75.135	60.535	76.391	77.439	91.171	78.928	-15.1	0.3	-1.9	1.03	1.51	1.03
4521	Dept. strs. (excl. leased depts.)..........................	21.687	15.210	23.425	25.188	31.915	26.624	-21.1	-1.7	-5.4	1.16	2.10	1.14

Reference no: EM131942316

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