Acushnet Canada Inc.: The Bonded Warehouse Initiative
Acushnet Canada Inc. is considering using Canada Customs Bonded Warehouses to store golf shoes, gloves, outerwear and club heads inventory purchased from overseas suppliers. ACI often has to procure inventory four to six months before they needs it in order to ensure they will be able to meet customer requirements during the busy season. The critical managerial issue is considering the tradeoff between the cash flow savings (through duty postponement) and the need to meet the demand schedule, while taking into account storage limitations imposed by the private facility and their storage costs. This case can be used as an introduction to linear programming as well as an introduction to the concept of bonded warehouses.
Inventory Planning/Control; Linear Programming; Spread Sheet Application; Procurement
Canada, Large, 2004
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