COMPETING WITH SUPPLY CHAIN STRATEGY

Inventory & Leadtime Simulation Results

By reducing the worst case leadtime by 5% for each part number, a $226,000,000 inventory investment is required for 100% on time starts. That’s 19% less inventory; or $54,000,000.

Assuming inventory to cover each part’s current worst case leadtime, a $280,000,000 inventory investment is required for 100% on-time starts.

By reducing the worst case leadtime by 10% for each part number, a $174,000,000 inventory investment is required for 100% on time starts.That’s 38% less inventory; or $106,000,000.

By reducing the worst case leadtime by 15% for each part number, a $135,000,000 inventory investment is required for 100% on time starts. That’s 52% less inventory; or $145,000,000.

| 42

RightChain ™ : Maximizing Financial & Service Performance with Supply Chain Strategy © RightChain ™ Incorporatedl (All Rights Reserved) RightChain.com