Dream Beauty Company - Supply Chain Management (Case Study Sample)
Prepare a case analysis for Case 11 and answer question 1 & 3 at the end of case 11 (include as an appendix to the case).
The Case Analysis must include at least three references. Reference support should be included in the evaluation of possible solutions as well as the recommendations and/or implementation sections. The Case Analysis MUST include the following heading and follow this prescribed format:
Case study 11: Dream Beauty Company - Supply Chain Management
The management of Dream Beauty (DB) Company seeks to understand how different costs affect the efficiency and effectiveness of the supply chain company. DB Company manufactures and supplies cosmetics and beauty products to customers. The company is based in Nevada but its operations are found throughout the U.S. To understand whether the additional costs are associated with increasing sales there is a need to understand how the costs affect operational efficiency.
Current costs allocation, improving efficiency and more accuracy
Based on the current situation the company reported sales totaling $ 130,000,000 with the retail section account for 50% of the sales, the convenience stores accounting for 30% while the mass merchants accounting for 20%. At the same time, the cost of goods sold was 40% of the total sales. Subsequently, the cost category was based on order processing at$ 10,000,000, packaging costs at $ 8,000,000, labeling costs at $ 2,000,000, and delivery costs at 30,000,000 for a total cost category of $ 50,000,000. the retail an convenience stores products are processing without first being labeled, but the there are suggestions for a new labeling machine costing $ 10,000,000 to cater for labeling for the products processed for the mass merchants. Since the labeling machine is deprecated on a straight line basis for a five year, it will decline in value by 2,000,000 for the depreciation period.
Even though, DB company received 3,600 orders for the three distribution channels the convenience stores received the most at 2,500 followed by retail at 1,000 and lastly mass merchants who received only 100 orders. On the other hand, there were 2,000 shipped packages at one time represented as 1,000 orders to the convenience s...
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