<p> Practice Problem: Chapter 16, Just-in-Time Systems</p><p>Problem 1: Bryant Electronics produces short runs of battery-powered pocket lanterns. You have been asked to reduce inventory by introducing a kanban system. After several hours of analysis you have developed the following data for connectors used in one work cell. How many kanbans do you need for this connector?</p><p>Daily demand 1,500 units</p><p>Production lead-time 1 day</p><p>Safety stock 1 day</p><p>Kanban size 250 units</p><p>Problem 2: Perkins Lighting wishes to employ a kanban in their new floor lamp production system. For the floor lamp base, they have provided the following information:</p><p>Daily demand 300 units</p><p>Holding cost $20/unit/year</p><p>Order cost $10/order</p><p>Lead time 2 days</p><p>Safety stock 600 units</p><p>Find the size of the kanban and the number of kanbans required.</p><p>1 ANSWERS</p><p>Problem 1:</p><p>Demand during lead time= 1,500</p><p>Safety stock= 1,500</p><p>Therefore: Maximum inventory level= 1,500 + 1,500 = 3,000</p><p>Number of kanbans needed= maximum inventory level/kanban size = 3000 / 250 = 12</p><p>Problem 2:</p><p>Daily demand 300 units</p><p>Holding cost $20/unit/year</p><p>Order cost $10/order</p><p>Lead time 2 days</p><p>Safety stock 2 days demand</p><p>Find the size of the kanban and the number of kanbans required.</p><p>Assume that the size of the kanban is the EOQ:</p><p>2*Demand *Order cost 2*300*300*10 Q= = = 90,000 = 300 units Holding cost 20 \kanban size = 300</p><p>2 Number of kanbans= (demand during lead time + safety stock) / size of kanban</p><p>=[(2*300) + 600]/ 300 = 1200 / 300 = 4 kanbans</p><p>3</p>