Sport Obermeyers Essay

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Objective and Scope To determine if Sport Obermeyer should produce women parkas either in China or Hong Kong with the right order quantity after taking risks and benefits associated with each option into consideration. The order quantity of each style will be determined for its first and second phase of a yearly production. The final decision pertaining to a production should allow Sport Obermeyer to be sustainably profitable in the long run. Recommendations 1. The optimal order quantity of women’s parka that Sport Obermeyer should order in 1993-1994 season are the following: Assault (2,755), Seduced (4,393), Entice (1,526), Electra (2,423), Gail (1,148), Daphne (2,854), Isis (1,260), Anita (4,003), Teri (1,357), and Stephanie (1,466). 2. Some styles of women parka need to be dropped since it is high risk associated with marginal loss, sale loss, and high uncertainty forecast from the committee. 3. Long-term, Sport Obermeyer should produce all women’s parkas in China due to the lower labor cost (See. Exhibit 7-10) 4. China product operation should improve the product quality by train the workers’ performance. Analysis Each year Sport Obermeyer encounters a production commitment for each skiwear item for the coming year’s line. Manufacturing skiwear in advance is somewhat problematic since the company needs to make an accurate forecast of retailer demand to different styles and colors. With greater product variety and fierce competition in the industry, there is high chance the company can end with excess inventory or out of stock. The two scenario will cause the company a tremendous lose. Sport Obermeyer having six key managers as a production committee, and their task is to individually forecast retailers demand for each Sport Obermeyer’s product. The final decision about where to produce and how many will be determined based on the six

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