Operations Management Problems Solutions

11.5 Baker Mfg. Inc. (see Table 11.9) wishes to compare

its inventory turnover to those of industry leaders, who have turnover

of about 13 times per year and 8% of their assets invested in

inventory.

a) What is Baker�s inventory turnover?

b) What is Baker�s percent of assets committed to inventory?

c) How does Baker�s performance compare to the industry

leaders?

11.6: Arrow Distributing Corp. (see Table 11.9) likes to

track inventory by using weeks of supply as well as by inventory

turnover.

a) What is its weeks of supply?

b) What percent of Arrow�s assets are committed to inventory?

c) What is Arrow�s inventory turnover?

d) Is Arrow�s supply chain performance, as measured by these

inventory metrics, better than that of Baker in Problem 11.5?

Solutions