ROLE: Purchasing Manager
In a few minutes, you will be attending a meeting of a working group chaired by Alex Rheingold (your MD) to discuss the possible adoption of an MRP2 system in Oakland. The initial meeting will be followed by a consultant's presentation and then a final meeting to take a decision.
You are responsible for controlling the raw materials stock levels. The maintenance of adequate stocks of quality timbers is a particular concern. You are interested in JIT and like the ideas, although you don't know how to go about introducing them. You are not sure how relevant JIT is to your timber stocks; timber requires conditioning before it can be processed. But, you feel that a JIT system might be more appropriate for Oakland than MRP2 which is based on a conventional Western approach.
Currently Oakland's try to operate a reorder point system for raw materials. This is certainly possible with the manufactured items such as hardware and chipboard. As far as possible, you negotiate bulk discounts through competitive tendering. This can lead to substantial cuts in purchase prices, but it does mean that you have to carry very large stocks of certain items. However, Oakland's manufacturing suppliers (who provide chipboard, blockboard and the like) will only deliver in certain minimum batches; e.g., 10 tonnes of ply - 10,000 square metres or so.
The purchase of solid timber is particularly problematical. You know a lot about timber, especially in choosing high quality stock.. Here it is rare for large purchases to be made. The selection necessary means that unpredictable and varying amounts will be purchased as and when timber stock of the appropriate quality and type becomes available. Moreover, because of the natural characteristics of wood, timber stocks have to be held under controlled conditions sufficiently long for the material to stabilize. In some cases the company takes an option on wood still standing. In these cases, of course, the final yield is difficult to estimate. There are also occasional opportunities to purchase excellent specimen timber stocks in small quantities, for instance following gales or storms which inevitably bring some trees crashing to the ground unexpectedly. You are always on the lookout for such opportunities. In such cases, you keep close contact with Rowan Gregory, the Designer, who will come up with "specials" which incorporate the specimen timber as a feature.