Mini Motor Homes Manufactured Essay

This case is about Mini Motor Homes Manufactured by Jim Ballenger in Kalamazoo, Michigan. According to the case, Jim Ballenger has a problem to make a stopping point to change his current line system to JIT system. From the current blood line system, Jim has spent a lot of cost on his inventory system. This is because mostly of the share used in manufactured are bought from other vendor and his teleph peerlessr actually only manufactured very few of it helping. Because of this, the transportation and inventory cost contribute to a relatively large portion of its chemical element commence of expenses.Jim Ballenger was very awake(predicate) on the cost that may approach once the JIT system adopted. The cost that he may be aware to arise is the cost of management standpoint, the shipment of the fraction and the rate of the component purchased. Besides that, he also has inquiry about the component purchased depart be arrived on time or not or the age taken of delivering the component. This is because, if the component are not suitable to use, his team has to fill in it and it will entail expensive rush order for the replacement component or the downtime for the entire plant. Jim Ballenger also concern about his relationship with his suppliers.He thought that his supplier may difficult become one part of his team. Since the supplier will expect to have special effort on their quality control or delivery flexibility on behalf of one of its almost miniscule discount. Jim Ballenger has been rent a public warehouse just his plant to keep his inventory that cost $500,000 to $1,000,000, which he paid more than than 1. 5% per calendar month from the borrowed funds to buy it. Since he starts to producing the different model, and victimization so many different appliances, the cost of the rubber stock increase day by day. The JIT presume table has drawn with two considerations.Since the study component, chassis can be purchased at one time foot from the lo cal supplier and out of stock situation is hardly happen, thence this component has excluded from using JIT system. The two considerations will be (1) Ballengers inventory carrying costs of are assumed to be 20% per year on the average investment in inventory on hand comprising encyclopedism and transportation costs, (2) those components that can obtain from closer sources, one week of the safety stock is sustain, if the component is further form the stock, two weeks to one month of safety stock should be available.