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Business Case Study: Steve's Tire And Lube '

opinionated Essay
1112 words
1112 words
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In this case, We have found Steve’s Tire and Lube’s company to have strong competitive priorities with their friendly environment, honest an reliable work, good reputation in the small town, quality service are worth the price, variety of services and supplies at retail, good employee training at vocation school, and most importantly they have loyal and hard workers, thus store turnover is rare. The order qualifier is service variety, including good services about oil changes, tire rotation and balance, brake pad replacement, and service inspection. In addition, provide retail parts and supplies are also considerable for the customer. Comparison with the same type of store, Steve’s has good order winner than others. It is about offering high …show more content…

In this essay, the author

  • Explains that steve's tire and lube has strong competitive priorities with their friendly environment, honest and reliable work, good reputation in the small town, quality service are worth the price, variety of services and supplies at retail, employee training at vocation school, and most importantly, loyal and hard workers.
  • Recommends steve's find ways to reduce total costs and service price, and get more mechanics permitted to do work beyond the basics to save customer waiting time.
  • Opines that steve's has appropriate process strategy decisions. steve provides flexible work on vehicles and spends lots of time to communicate with customers.
  • Opines that the front office and back office demarcation is not clear and effective. they recommend steve's to improve the current layout as soon as possible.
  • Explains that moments of truth in the process are the most significant point to interact with each customer, which has a major impact on how the customer perceives our company.
  • Explains that the utilization by day and by mechanic is under exhibit1-2. utilization rate is too high on monday and low on saturday. steve's can equal distribution mechanic hour,thus change utilization to 85%.
  • Explains that steve's tire needs to increase the amount of high demand products and decrease the low demand safety level.
  • Explains that the total hours of each day are 70, 32,38,28,64, and 18 based on the data.

For the other part and supplies, the highest safety stock level is 80.85, which is the high performance motor oil. For other products, they are not as high as the motor oil and their safety stock level is fall between 1.82 and 17.99. The arrangement of the stock level is appropriate since the delivery time for the protective covering is one week while the sale and demand for the covers are high. So it is reasonable to have a high stock level. Since the service level is very high (95%), we recommend that the safety level for seat cover can be higher. We can find out that by using the continuous review system the total annual cost of ordering and holding inventory is $6646.57. Also, we find that the holding cost is 30% of the unit cost and the transportation cost for each order is $40. In order to minimize the total inventory cost, Steve’s Tire needs to increase the amount of the high demand products and decrease the low demand safety level. By doing the recommendations above, Steve’s Tire can avoid the extra order cost and the wasted inventory

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