Mt435 Case Study 2

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Unit 3 Written Assignment KU Consulting Proposal for Albatross Anchor MT435 Operations Management Kaplan University Introduction Albatross Anchor is a small, family owned company that makes marine anchors for fresh and salt water boats. It was started in 1976 and has grown to employee approximately 130 people. It sits on 12 acres of land in a rural area with no immediate waterways nearby. The company has not advanced with the times and needs updates to its administrative, manufacturing, shipping and marketing processes. The company really needs a complete overhaul so that it can gain a sustainable, comparative advantage in the marine anchor market. Question 1 Based on the information presented in the scenario/case study discuss Albatross Anchor’s competitiveness in relation to (please address all items in the below list and provide support for your conclusions): 1. Cost a) Cost or Production: Operational inefficiencies have caused production costs at Albatross Anchors to be a lot more than they should be. This means they have a smaller profit margin, inefficiencies eating up their potential profits. They could be making more money per unit if they would tighten up their processes. They make two types of anchors. The bell type and the snag hook type. They have to stop production when they get an order for the opposite type of anchor and this down time for set up is very inefficient and costs a great deal. It takes about 36 hours to make the switch. This down time for set up is costing them a lot of money. Their competitors, who may operate more efficiently, aren’t loosing this time and money. Albatross Anchors charges $8 per pound for the bell anchors and $11 per pound for the snag hook anchors so they are charging about the same price as their competitors and with their slower production time, it’s almost impossible for them to be
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