Albatross Anchor - Essay

Topics: Costs, Variable cost, Fixed cost Pages: 6 (1674 words) Published: May 6, 2013
arAs a representative and consultant for KU Consulting firm your task is to use your expertise in Operations Management to assist Albatross Anchor. Write a report answering all the questions posed regarding the case study of Albatross Anchor. Demonstrate your understanding of course content by using concepts and principles from your textbook and from academic quality research to solve these challenges. Albatross Anchor Case Study (Note: This is not a real company) Introduction

Albatross Anchor is a small family owned business that began in 1976 with four family members. Albatross anchor has grown exponentially and now employs one hundred and thirty people. This one location/facility is situated on twelve acres located in a rural suburb of Smalltown, USA (Please note* the building and facilities for Albatross Anchor are landlocked).

The plant* and the administrative offices are located in the same building.

(*Note: The plant includes: manufacturing, the shipping department, the receiving department, raw materials storage, finished product storage, and the foundry).

The administrative offices are in the front of the building and the plant is located directly behind the administrative offices (see diagram). The administrative offices have issues because they are somewhat shabby, disorganized, and run inefficiently. The plant is antiquated, worn, dirty, technology-deprived and it no longer meets all US safety and environmental standards.

The owners of this small business have added on various processes as needs arose; within the limited space of the plant. When Albatross Anchor first opened its doors their expertise was in the manufacturing of bell/mushroom anchors (using a foundry process). In 1989, in response to international competition, the owners of Albatross Anchor made the decision to expand the product line to include fabricated snag hook anchors.


Albatross Anchor is a manufacturing factory that sells only at the wholesale level. Albatross Anchors sales their products in two ways:

(01) Distributors that act as the middleman. The distributor accepts bulk delivery of anchors at their large distribution centers. At the distribution center the bulk shipment of anchors is broken up into smaller batches and shipped to individual retail locations. (02) OEM customers that purchase anchors in large batches to be used as a component in the manufacture of boats.

Albatross Anchor does not sell retail. They are strictly a wholesale organization.5 product
The bell anchor is manufactured primarily through a foundry process in which ore is transformed into a liquid state and then poured into molds as part of the production process. The bell anchor is used primarily by fresh water marine craft.

The snag hook anchor is fabricated through the bending and welding of iron rods and flat iron into a hook design. The hook design is best when used in saltwater. This hook design snags bedrock and seaweed which holds the marine craft at anchor. The snag hook anchor is used primarily for small to medium sized saltwater marine craft.

Each anchor is produced in multiple sizes to accommodate the type of watercraft, the size of the watercraft and the place where the anchor will be used (salt water or fresh water).


Each anchor type requires its own unique equipment and manufacturing process. Yet, both manufacturing areas share the same shipping area, receiving area, warehouse area, and administration offices.

The manufacturing area of the plant has had to change to accommodate the manufacture of the two separate types of anchors. As each anchor requires its own manufacturing challenges the manufacturing line must be completely changed over each time the anchor type is changed. The time to switch over from one manufacturing process/operation to the other manufacturing process/operation is 36 hours.

The plant space is at a premium and warehousing space for raw...

References: Type the references here.
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