Sport obermeyer minimum

To determine how many of each style to order in the first round, preference was given to the lower risk items.

sport obermeyer case study course hero

Based out of its Aspen, Colorado headquarters, Obermeyer currently offers a broad line of fashion ski apparel, including parkas, vests, ski suits, shells, ski pants, sweaters, turtlenecks, and accessories.

Properly align current supply chain sources subject to supply channels in Hong Kong and Greater China. China, on the other hand, offers lower overall costs and is better for lower risk designs. These issues were addressed by the Hong Kong facility where quality of product was good, the labor could multitask, a lower minimum order size was required and the time of production was low.

Short-term Operational Changes- The maximum production of 20, set by Wally should be increased. Any loss incurred sue to this segment will be huge and taxing. Our first meeting was Tuesday November 3rd, This joint venture allowed Obermeyer to manage supply and production operations in Hong Kong and China.

The first thing put into place was we created a plan for how we would structure this assignment.

Obermeyer supply chain case

Supporting Analysis: Sport Obermeyer has the issue of lack of stock during peak sales of certain types of parkas. This would be preferable because sourcing Gail from China would require more units to be produced than what is forecasted to be sold. The production planning problem that Obermeyer faces is a mathematically complex stochastic optimization problem. Improved equipment e. The best way to mitigate the inability to meet the demand of retailers during peaks sales would be to forecast the demands with either past data or with the help of a forecasting committee. Our calculations of coefficient of variation can be seen in the attached excel spreadsheet. Risk associated Production: Sport Obermeyer should produce the designs and styles that have the least standard deviation because they are least risky. Sport Obermeyer, Ltd is in the business of manufacturing skiwear which includes short life cycle items due to their short selling season and dependence on trends in fashion. The reason being, if the company selects China for its order, it is probable that the order is of bulk quantity. Any loss incurred sue to this segment will be huge and taxing. Therefore, the company begins booking production the previous November, or about a year before goods would be sold, based on speculation about what retailers would order. Referring to exhibit 1, the four products to be produced in China in the first production cycle are: Assault, Seduced, Entice and Electra. Organization challenges along with competition from competitor companies were major challenges the company had faced. Each year Sport Obermeyer is challenged with matching supply to demand because production must be forecasted more than one year ahead of the expected selling season. The method we used was to take the average demand from each of the six committee members for each product, subtract the standard deviation, and multiply in a variable k to get to the desired production level of 10, units.

PowerPoint Presentation:. They are trying to figure out how much and where to produce their line. Furthermore, Obersport should work with its Chinese facilities to attempt to make an agreement to allow reduced minimum orders and implement a program that will improve worker skills.

Recently, the company has faced increased competition from other winter apparel makers, namely Columbia Sportswear. They are in a dilemma of which location to continue their production in — Hong Kong or China: Raymond Tse had built the new factory in China where the cost was less but the quality had to be compromised.

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Case discussion answer Sport Obermeyer company