FoldRite Furniture: Case Report
ECLT 5940 case studyFoldRite Furniture Case Report
ECLT 5940 Supply Chain Management Group member:
Huang Yi Fang Peiwen Qi Jin Tan Yunxuan Zhang Yanfeng 1155024743 1155021692 1155010896 1155020407 1155024230
1. Background and Issues
1.1 The background of FoldRite
In 1987, FoldRite Furniture Company was founded, and the Company gained some success by producing a folding banquet table. By the late 1990s, FoldRite had kept a stable growth, selling three product lines into a range of markets. In 2006, with financial turmoil, high turnover among factory workers and unbalanced percentage of new workers led to the loss of productivity and yields, which increased margins and lead-time. At the same time, the company used too much cash and distracted management attention to purchase small firms. In 2007, some private investors took over FoldRite to provide fresh capital and management expertise. The New CEO (Marshal Epstein) hired a new Manufacturing VP (JOE Ramos). They set some new policies to achieve new goals and made some changes. In 2009, FoldRite still had about $60M in revenues and was profitable in spite of recession.
1.2 The issues of FoldRite
Analyzing those five options and using the combination of those options, We try to make a trade-off between minimizing the cost and the strategy of company. (a) Changing the designs (b) Using overtime (c) Increasing staff temporarily (d) Increasing the amount of inventory using a constant level of production. (e) Using subcontract
2. Recommendations
2.1 Recommendations for production plan
(a) When the manufacturing cannot meet the demand, we consider using overtime or subcontract to fill the production gap. The answer is subcontract, because the money we have to pay for the subcontract is less than the overtime. Moreover, choosing subcontract could
avoid the problem which overtime has, such as decline in quality and loss of productivity. (b) Changing design decrease the demand for unskilled workers in
ECLT 5940 Supply Chain Management Group member:
Huang Yi Fang Peiwen Qi Jin Tan Yunxuan Zhang Yanfeng 1155024743 1155021692 1155010896 1155020407 1155024230
1. Background and Issues
1.1 The background of FoldRite
In 1987, FoldRite Furniture Company was founded, and the Company gained some success by producing a folding banquet table. By the late 1990s, FoldRite had kept a stable growth, selling three product lines into a range of markets. In 2006, with financial turmoil, high turnover among factory workers and unbalanced percentage of new workers led to the loss of productivity and yields, which increased margins and lead-time. At the same time, the company used too much cash and distracted management attention to purchase small firms. In 2007, some private investors took over FoldRite to provide fresh capital and management expertise. The New CEO (Marshal Epstein) hired a new Manufacturing VP (JOE Ramos). They set some new policies to achieve new goals and made some changes. In 2009, FoldRite still had about $60M in revenues and was profitable in spite of recession.
1.2 The issues of FoldRite
Analyzing those five options and using the combination of those options, We try to make a trade-off between minimizing the cost and the strategy of company. (a) Changing the designs (b) Using overtime (c) Increasing staff temporarily (d) Increasing the amount of inventory using a constant level of production. (e) Using subcontract
2. Recommendations
2.1 Recommendations for production plan
(a) When the manufacturing cannot meet the demand, we consider using overtime or subcontract to fill the production gap. The answer is subcontract, because the money we have to pay for the subcontract is less than the overtime. Moreover, choosing subcontract could
avoid the problem which overtime has, such as decline in quality and loss of productivity. (b) Changing design decrease the demand for unskilled workers in