Exam 9: Sales and Operations Planning: Planning Supply and Demand in a Supply Chain

The capacity management approach where a firm builds facilities to produce a relatively stable output of products over time in a very efficient manner and facilities to produce a widely varying volume and variety of products, but at a higher unit cost is

Pricing decisions based only on revenue considerations often result in

A firm can vary supply of product by controlling production capacity and inventory.

Discuss the approaches that can be used to manage capacity to meet predictable variability of demand.

Promoting during a peak demand month may decrease overall profitability if a significant fraction of the demand increase results from a forward buy.

Pricing decisions based only on revenue considerations often result in an increase in overall profitability.

The capacity management approach where a firm purchases peak production from another firm so that internal production remains level and can be done cheaply is

Discuss the approaches a firm can use to manage inventory to meet predictable variability of demand.

When planning, the goal of all firms in the supply chain should be to maximize supply chain profits because

Companies typically divide the task of supply and demand so that

Supply chains can influence demand by using

In this approach to managing capacity, a firm uses a temporary workforce during the peak season to increase capacity to match demand.

Which factor favors promotion during peak-demand periods?

Which factor favors promotion during low-demand periods?

In general, as the fraction of increased demand coming from forward buying grows, offering the promotion during the peak demand period becomes more attractive.

Predictable variability is

Which approach to capacity management would use a part-time workforce to increase capacity flexibility by enabling the firm to have more people at work during peak periods?