Inventory Control at Wheeled Coach Inc.

Topics: Inventory, Material requirements planning, Enterprise resource planning Pages: 5 (1691 words) Published: September 13, 2011
Company Profile: Wheeled Coach

Wheeled Coach Industries, Incorporated is the largest manufacturer of ambulances and rescue vehicles. The subsidiary of Collins Industries, Inc. was founded in 1975, and is currently based in Winter Park, Florida. Wheeled Coach, led by their President Bob Collins, Jr. employs a highly trained production team of over three hundred and fifty personnel who are responsible for the assembly and final production of all ambulances in their production facility. Wheeled Coach offers its product through their dealers, their global sales network, direct sales, and online. The company’s keys to success include, but are not limited to: custom designs, the use of work cells, a single focus factory design, an innovative engineering team and inventory control. Wheeled Coach Industries boast several designs to meet the needs of their customers and prides itself on meeting their delivery deadlines. On average, the company rolls out twenty vehicles per week off of their assembly line. To stay competitive and dominate the ambulance market place, Wheeled Coach, Inc, relies heavily on an efficient inventory management process that provides for minimum but accurate inventory, great quality, tight schedules and accurate records. This was made evident when recently, Wheeled Coach, Incorporated won a Multi-Year Contract from the City of New York to provide new ambulances for their Fire Department.

Inventory Concerns:

Sound inventory management is one of the company’s keys to success. Effective auditing procedures enable success by increasing the company’s ability to meet deadlines, appropriately allocate resources and operate efficiently. The three primary inventory concerns as per this case study are: 1)Long Lead times for Aluminum (Reynolds Metal)

2)50% of the cost of all manufactured ambulance are from purchased materials 3)The parts that make up the vehicles chassis components account for a large percentage of the purchased materials. Inaccurate inventory balances can lead to production delays, missed deadlines, a decrease in customer satisfaction and ultimately loss of sales. Wheeled Coach Industries Inc. employs a number of systems aimed at inventory management. Material Requirement Planning (MRP):

The variety and nature of the process involved in the product manufacturing at Wheeled Coach, requires a good and effective Materials Requirement Planning (MRP). Seeing that demand for every part of an ambulance is dependent; Wheeled Coach made a business decision to use the dependent inventory scheduling system. This system, has served them well. Through the use of MRP, Wheeled Coach has found competitive advantage by reducing their inventory levels, responding faster to market changes, improving the use of their facilities and labor force and responding better to their customer orders. Dependent Inventory Requirements:

Wheeled Coach’s success with MRP has been a result of their solid understanding of the requirements that make MRP successful. These requirements include: a)Master Production Schedule (MPS)
b)Bills-of-Material (BOM)
c)Inventory or Stock Availability
d)Purchase Orders Outstanding
e)Parts Lead Time
The below figure provides an example of the planning process and the questions that the inventory manager at Wheeled Coach will ask to develop realistic schedules to improve production process.

By following a similar approach in their MRP process, Wheeled Coach, Inc. has greatly improved their market share and hence their status as the global ambulance giant. ABC Analysis:
Another inventory management methods used by Wheeled Coach Incorporated is ABC analysis. ABC Analysis is mostly concerned with a few of the most critical inventory items, instead of all of the items which could prove to be burdensome. In many cases, inventory control is determined based on the cost of the inventory item. It would not be economical to monitor inventory on inexpensive items the same...

References: Bloomberg Business Week. 03 April 2011.
Heizer, J. & Render, B. Operations Management. Saddle River: Prentice Hall, 2011.
Wheeled Coach Industries. 05 April 2011.
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