The Jewel Golf Club Company, which recently began using a kanban system, has had problems with high inventory levels of one of the handle grips used to make several versions of its clubs. Daily demand for the grip is 3000 units, average waiting time during production is 0.20 day, processing time is 0.10 day per container, and a container holds 150 grips. Use the information in Case 6.2. How many Kanban containers would Jewel require if a 10% policy variable is used? a. three or fewer b. four or five c. five or six d. six or seven

d. six or seven

Explanation:

Given that:

Daily demand for the grip = 3000 units

average waiting time = 0.20 day

processing time = 0.10 day / container

a container holds = 150 grips

percentage of policy used = 10% = 0.10

The objective of this question is to determine the amount of Kanban containers would Jewel require.

the amount of Kanban containers = Demand (wasting time + processing time) (1+percentage policy) / amount of container holding

the amount of Kanban containers = 3000 (0.2 + 0.1) (1 + 0.10) / 150

the amount of Kanban containers = 3000 (0.30) (1.10) / 150

the amount of Kanban containers = 990/150

the amount of Kanban containers = 6.6

SO we can infer that the amount of Kanban containers would Jewel require if a 10% policy variable is used falls within the range of six or seven.