Solve the below:
Q: Your manager asks you to perform ABC Analysis to increase the efficiency of your company. He provides following data related to hits and total profit for each item; then asks an analysis based on combination of hits and total profit. Perform ABC Analysis for your company with A items = top 55%, B items = next 30%, C items are the remaining ones. Manager believes that profit made from a product is three times more important hits of the product. (Assume , , and )
|
ITEM
|
Hits
|
Total Profit
|
|
1
|
13
|
360
|
|
2
|
30
|
575
|
|
3
|
5
|
1400
|
|
4
|
7
|
725
|
|
5
|
67
|
520
|
|
6
|
105
|
450
|
|
7
|
10
|
1500
|
|
8
|
15
|
350
|
|
9
|
36
|
800
|
|
10
|
16
|
125
|
Explain reasons for a company to keep inventory
Describe the following inventory problems and policies briefly ?