Owens Miner

Owens and Minor (A) This is a case that has relatively few calculations. However, it is a nice application of how superior costing information endure assist alter decisions. Also, it highlights some of the issues involved in retroversion behavior, particularly crossways organizational boundaries. 1.Evaluate the impact of undetermined price on distributors, customers and suppliers. Distributors (Owens & Minor): Some products are most high-priced to track than others. Using a flat 7% across each products provides very different profit margins across products, not a clear 7%. This model is causing O&M to lose profit. Customers are also demanding much(prenominal). Previously, O&M would suffer a load weekly to the hospital dock. The hospital would and so receive and breakdown the shipment. Now, many hospitals are requesting little shipments more than frequently, modeling a JIT take stock type system. In addition, some venues are moving toward a stockless system, requiring O&M to package the production in much smaller units, unremarkably in a plastic tote which would go soon to the nursing and surgical units, bypassing the entire storeroom processes.

The following scanty requirements for a sockless or JIT system add superfluous cost, tighten profit margin on a cost incontrovertible model; supernumerary line item, reckon of POs, subroutine of deliveries, special packaging requirements, bulk shipment breakdown handling, scrutinize carrying cost for O&M, additional staff required for the additional services. To express reduced costs, distrib utors generally buy larger orders from suppl! iers to tick an economy of scale discount. However, this would require distributors to carry and handle more inventories. Distributors are often carrying receivables much longer than the suppliers payment terms. This puts a constraint on cash. Customers (hospitals and health help centers): Hospitals with stockless systems and high maintenance actually may benefit from a cost plus system. These venues...If you want to get a untroubled essay, order it on our website: BestEssayCheap.com

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