sport obermeyer Essay

523 Words3 Pages
Case Summary of Sport Obermeyer, Ltd. After reading through the whole case, the key problem Sport Obermeyer is trying to solve here is obvious – just match supply with demand. However, because of the dynamics of the fashion ski-ware industry, Obermeyer is facing both ever-changing demand and supply, which brings high uncertainty to this simple match problem. For the demand, Obermeyer is attempting to predict what styles are going to be popular two years later with little data is available. To make it even worse, Obermeyer’s production decisions hugely depend on this two-year-advance prediction. What better results can we expect? It’s nearly impossible to make an accurate forecast of the demand, and the attached problems are either stock-outs or markdowns, which indicates the loss of manufacturing cost or sales revenues. What’s more, the large lot sizes required by manufacturers put further restrictions on Obermeyer’s ability to respond to the uncertain demand. As for the supply, Obermeyer is suffering from long lead times, due to limited supplier capacity. The lead times of most raw materials can be more than 45 days, some even 90 days or longer which highly constrain Obermeyer’s production ability. Obermeyer also has issues in allocating production between factories in Hong Kong and China mainland considering different labor cost and efficiency. In a word, Obermeyer is trapped in an outdated supply chain with pressures both backward and forward. Here are some suggestions after detailed discussion of our team, which hopefully can improve the supply chain somehow. 1. Better forecast with periodic updates. Every problem in this case dates back to the inaccurate forecast of the uncertain demand. The more accurate we predict the demand; the likelihood the supply chain can be improved. With periodic updates to the forecast, old forecast can be corrected and new

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