Peak Profit Potential by Donna Thompson

Author:Donna Thompson [Thompson, Donna]
Language: eng
Format: mobi
Publisher: Goals in Action, LLC
Published: 2013-12-29T14:00:00+00:00

The Profit PyramidTM Case Study

Edward was managing a light industrial firm that manufactured high-end tools for mining companies. His strategy, objectives, and goals were clear. So Edward wanted to know more about his measures. One of his favorite metrics was to decrease the cost-per-run on the production line; running a larger volume of units to spread the set-up time costs across more units effectively lowering the cost per unit. Mission accomplished, right? Not so fast. The large production runs created excess inventory, carrying costs, and increased floor space demands. The CFO stepped in to balance the current order size and forecasted orders with the fixed cost to set up the line and the associated costs to hold the excess inventory.

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