Inventory and Time-based Logistics

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IBMS 406 Group I
1. What are the major business propositions for Woodmere and HomeHelp to consider in evaluating this proposal? Is time-based logistics the right strategy for each company? These are the major business propositions:

* Information transmission system from POS data to manufacturing plant. * Inventory level control
* The future perspective of annual growth
* New business process
* The initial investment on equipment, and additional cost

The time-based logistics will be the right strategy for each company. The first reason is the sales information transmission which POS data clearly indicates the product’s demand from the customer to the manufacturer. It’s more accurate that a forecast. The second point is to reduce the order cycle time. The actual sales and consumers trends will guide the manufacturer to respond the order quickly. The third factor is that decreases the inventory level. The inventory is well controlled by knowing for sure customer’s needs.

2. What are the benefits and barriers (short and long-term)to this proposal for both Woodmere and HomeHelp? What other factors need to be considered?

For short term benefits: increase sales and short replenishment cycles allow fewer inventories. The Long term benefits are Building a stronger and more reliable business partnership by making the switch and continuous improvement sustainability. One of the other benefits of this proposal is that it would enable both companies to increase their sales and profitability. By adopting the proposal, both companies would be able to reduce the total channel costs as well as provide customers with premium product availability. By adopting the proposal, Woodmere would benefit by getting withdrawing an alliance with a retail company that is in financial trouble. Moreover, the image of the company would be greatly enhanced. A major barrier that Woodmere would face in implementing the new strategy is the fact that it would...
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