Four Stars Industries Logistics

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Four Stars Industries Logistics

Category: Case Study

Subcategory: Logistics

Level: Masters

Pages: 1

Words: 275

Four Stars Industries Logistics

Question 1.
Four Star Industries faces four principal problems in its mattress manufacturing operations. Firstly, the pressure from activities that ranged from manufacturing to assembly and quality control is passed on to workers causing them to be dissatisfied and contemplate leaving the company. This is seen where the company previously produced 13 mattress models but now produces 230 models to require more work with the potential for increasing the turnover rate. Secondly, the company is experiencing reduced sales volumes every year. Thirdly, stock-outs of slow-moving mattresses and poor inventory management. Fourthly, declining order refill rates as a result of the stock-outs and competition. Fifthly, the company’s inability to accurately match customer demand to its supply. Sixthly, the company faces intensified competition for the local market. Finally, there is inefficient production scheduling. The five issues that have been mentioned describe the problems that Four Star Industries faces in its mattress manufacturing operations.

Question 2.
The proliferation of mattress varieties has an impact on Four Star’s operation. In this case, the proliferation has increased the demand placed on the company’s operations to create a situation in which they appeared chaotic. For that matter, the added pressure that workers face in producing a greater variety of mattresses for its local dealers have reduced their satisfaction levels and made it difficult for them to match the market demand with the correct mattress inventory. In this respect, the proliferation of mattress varieties has negatively affected Four Star’s operations by increasing the workload, reducing workers’ satisfaction levels, and making it difficult for its personnel to match market demand to inventory.

Question 3.
Sia Ming can address the mentioned problems using some strategies. Firstly, the company can reduce the variety of mattresses although this might not be acceptable to the dealers who orchestrated the increase in mattress variety produced by the company. Secondly, it can change its policies to include the minimum order number of mattresses for dealers. Dealers are likely to reject this strategy if they are not carrying the stock for that mattress type. Thirdly, the company can adopt lean manufacturing whereby communication is improved between dealers and the company to enable anticipation of market needs. Fourthly, eliminating waste by only manufacturing what the market needs in sufficient quantities that do not create surpluses and waste. Finally, including time as part of the order fulfillment requirements to enable workers to plan for production, reduce pressure, and improve satisfaction levels. Applying the five courses of action that have been mentioned are likely to solve Four Stars Industries demand-supply problems.