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Case Study U.S. Strollers

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Submitted By charlesgrant365
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Introduction As the leader producer and seller of baby strollers, U.S. Stroller has been known for carrying a very high-quality baby stroller. The company is known for innovation designs and its good distribution system. The President of U.S. Stroller Judy Hawkins is the sister of the director of manufacturing Clem Hawkins. Judy has suggested to Clem that a Just-in-time system is what the company needs to reduce the high inventory cost, cycle time, improve quality and eventually cost the company is carrying. Clem decided he would solicit the help of Joan Hankins who had recently graduated from UCLA with an M.B.A; she was a whiz at analyzing.
Below is a list of the facts about the company: 1. 2000 different sites in the United States distributing the company’s product 2. U.S. Stroller has been on the market for 50 years 3. The company has 20% of the market share 4. Business started in 1934 with a regular model for $49.00 5. Deluxe model was introduced in 1955 and sells for $99.00 6. Shopping center stroller was introduced in 1974, which sells at $149 7. U.S. Stroller is currently selling 106,000 units per year of the three types of strollers 8. There are approximate $4.5 million per year in sales 9. 25% of sales is gross profit and 2% net profit for the fiscal year 10. Inventory turnover is at 2.4 times per year 11. The company has earned a 3% on net assets on an after-tax basis and 8% on owner's equity 12. 50% of parts for the stroller is purchased from outside suppliers
Clem has two options before him to consider in Just-in-time strategy, there are, a pull system, or manufacturing cells. Just in time is a fundamental building block for modern approaches to manufacturing planning and control (MPC), and is both a philosophy and a set of techniques. Moreover, the methods go beyond traditional manufacturing…...

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