ANIL KUMAR (PB1308)

H MAHESH (PB1317)
MOHAN (PB1341)
Brueggers bagel bakery makes and sells a
variety of bagels of which bagels are the main
source of revenue.
The bagel business is Rs. 3 billion industry.
It is no.1 nationally with over 450 shops that sells
bagels, coffee and bagel sandwiches.
It generates an average of 8,00,000 sales
annually for each store.
Customers are attracted for its taste and quality.
It is highly profitable business.
The manufacturing cost of one bagel = 10 Rs.
The selling price of each bagel = 50 Rs.
The profit margin per bagel is around 40 Rs.
The annual average revenue = 8L x
450 shop
= 3.6 billion
Employees who works in the store are carefully
chosen and trained to operate the necessary
equipment in stores.
Maintains minimum inventory.
1. Benefits and risks of maintaining little
inventory?

Ans .Little inventory means reduced cost and
space
Better supply chain management
Eliminates no. of warehouses
Ability to respond quickly according to customer
demand
Fresh products are made for the customers
Less waste, no or less unsold products
Reduced holding costs( labor cost, space cost,
managing cost )
Cost control and manageable breakeven
Less record or less inventory data entry work
The space can be utilize to expand retail stores
Saves labor time ( stowing, moving food )
Fast substitute of damaged goods is difficult
Less discounts for bulk buying
More time and effort needed to manage the stock
Production lifecycle can be affected by uncertain
demands.
Need good communication with suppliers
High freight cost for incoming and outgoing
shipments
Movement of dead stock also incurs costs
If deliveries are delayed the business might run out
of stock.
Quality is an important feature of a successful
business.
Customers judge the quality of bagels by their
appearance( size, shape, shine ), taste and
consistency.
Frequent visiting customers know the taste the
bagel everyday.
So little amount of taste variation can be
identified.


The production process is a continuous series of
process
Quality is the major constraint for the bakery.
The workers should check the quality at every
stage of operation

Types of inventory models that are used for
ordering the ingredients for bagels are
EOQ(Economic Order Quantity).
Economic production lot size model
An order-quantity , reorder-point model with
probabilistic demand.



The most appropriate inventory model for this
case is Economic production lot size model.
This model is used when the demand for the
bagels is almost constant.
So the inventory required for the day can be
attained with in the day itself.
The constant demand rate means the same
number of units taken from inventory each period
of time.
It gives information about
How much to order?
When to order?

Waste management
Just in Time
Inventory management which leads to cost
cutting
Total quality management
Quality function deployment.
Total productive maintenance.


Customer focused
Independent functioning
In case of failure of refrigeration can cause more
damage
Concentrate demand for the other available
flavors subsequently to the traditional bagels