Inventory Models Project

Description

1. Select 5 products to market whether you decide to produce or buy them, get real demands on the internet or estimate monthly random demands for all, over 12 months (at least 2 of the products must have non-constant demand, coefficient of variability greater than 0.2 and at least one of the other three must be made than be purchased). For the production continues model make your production capacity = 1.2*demand). Determine or find the sale price of each product and make your purchase cost equal to 60% of its sale price, or the actual purchase cost does have it .2. Describe the project you will develop, explaining the convenience or importance to apply inventory models.  3. Do a variability analysis (CV) for each of the 5 products, in order to choose the best inventory model for each of them, whether probabilistic or not. Mention which inventory control model you will use for each product and why, if probabilistic chose (r,q).  4. Develop in Excel the selected model for each item: finding your EOQ, your reorder point (assuming a supplier delivery period or take the real), your frequency of orders, the number of orders to lift in the year, the security inventory (if applicable). In addition, estimating your ordering cost k and your annual inventory cost per item as (h = 0.25 * purchase cost), also your purchase or production cost and total cost. If the model considers scarcity costs, add a column that includes them. One slide with one table only. Determine the annual order to purchase or produce cost, holding cost, shortage cost (if any), and the total annual costs for each item.  5. Prepare a cash flow over the twelve months, which specifies the income, as well as all the expenses (costs) and the monthly net flow (Income minus Expenses), including the accumulated income throughout the months. Indicate a final annual column, with the totals, make an statement of income, estimating with it your annual profit on sales and on investment and the IRR. Make an Excel table with the cash flow of each product and the concentrate of five. In this flow, the cost of inventory charges in each month, decreasing linearly instead of subtracting demand.  6. Repeat points 1, 3, 4 and 5 using the Wagner Within algorithm. For the Wagner model, make a Master Production Plan for each item. Present only one Wagner solving table as example  7. Write a clear explanation of why you selected these products, what criteria you use to estimate the demand and sales price, and a conclusion of your results.Compare and comment on results with both models. Present all the information, including your Excel tables in a PDF, file in English.