BUS307 Week 4 – Discussion Forum 2 Solution
Using the economic order quantity (EOQ) and reorder point (ROP) formulas, explain how such efforts would be consistent with JIT’s push for lower inventory levels.
- Maximize their process flexibility so that ordering costs are minimal.
- Stabilize demand levels.
- Shrink lead times as much as possible.
- Assign much higher holding costs to inventory than has traditionally been the case.