Case Four Star Analysis Essay

2348 Words Jul 17th, 2013 10 Pages
Team M
Team M

Four Star Industries Case Study
Case Study Anaysis
Four Star Industries Case Study
Case Study Anaysis

Table of Contents
Background
Current Situation * Market * Production * Manufacturing * Order Process * Inventory Management
Issues
* Model Proliferation * Inventory and Demand Mismatch * Poor Order Management
Analysis
* Safety Stock Analysis * Warehouse Rent Analysis * MOQ v/s EOQ * Production /Assembly Line Analysis
Recommendations
Conclusion

Background:
Four Star Industries Private Ltd is the manufacturer and wholesaler of the renowned Four Star Pocketed spring mattresses which was founded by Neo Gim Sin in 1966. Its business is aggressively and exclusively
…show more content…
Outputs from these departments are then assembled into the desired model of mattress at the assembly unit, sent to inspectors who check that quality standards are met. Goods that pass the quality test are then sent to that warehouse.
Ordering process:
LDs and SDs placed orders only after confirming orders from retail customers, and expected JIT delivery form Four Star. Product proliferation significantly complicated scheduling production. Stock-outs of some mattress models became a norm, resulting in a decline of order fill rates. Resultant backorders had to be produced on an expedited basis, making production more expensive than necessary. Most recently, an order from V-shopper – a Four Star dealer could not be met even after two weeks of order placement.
Inventory management:
Product proliferation resulted in increased finished goods inventory and warehouse capacity. Also, the new trend that vendors were no longer willing to keep inventory translated into increased finished goods inventory and warehouse capacity.
Issues:
Model proliferation:
Four Star Industries Private Ltd increased its number of mattress model by 18 folds in the last 6 years. This was a huge increase in the variation of the models. The company was trying to accommodate all the requests of the Dealers. It also launched in house models for large dealers. But while doing this, it still continued to produce the slow-moving goods. This resulted in huge

Related Documents