Kristine Cookie Case PDF

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Kristine Cookie Case...

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Kristen Cookie Case

1.How long will it take you to fill a rush order? It will take 26 minutes to fulfill a rush order for one dozen of cookies. 2. How many rush orders can you fill in a night, assuming you are open four hours each night? For each dozen cookies, it takes 26 min to fulfil the order. If Kristen Cookie Company is open four hours each night then, they have (4x 60) or 240 minutes to fulfil (240/26) or 9 orders. 3.How much of your own and your roommate’s valuable time will it take to fill each order? It takes eight minutes of Kristen’s and four minutes of her roommate’s valuable time to fill each order. 4. Because your baking trays can hold exactly one dozen cookies, you will produce and sell cookies by the dozen. Should you give any discount for people who order two dozen cookies, three dozen cookies, or more? If so, how much? Will it take you any longer to fill a two-dozen cookies order than one-dozen cookie order? Price of Ingredient (Per Dozen) $0.60 Price of Packaging (Per Dozen) $0.10 Total Price for 1 Dozen Cookies $.70 Selling Price for 1 Dozen Cookies $1.00 If Kristen wants to make a profit of $0.10, the labor can be $0.10 each for Kristen and her roommate. For two dozen of cookies, if the labor price is same then the discounted price for two dozen cookies can be $1.80 and the total time spent will be 45 minutes and they can make a profit of $0.20. Applying the same rule, for three dozen cookies the discounted price will be $2.60, the time spent will be 74 minutes and the profit will be $0.40.

5. How many electric mixers and baking trays will you need? For making one dozen of cookies, one electric mixer and one baking tray will suffice. To make more than one dozen of cookies, one mixer is enough but for each added dozen each additional tray will be needed. 6. Are there any changes you can make in your production plans that will allow you to make better cookies or more cookies in less time or at lower cost? For example, is there a bootleneck operation in your production process that you can expand cheaply? What is the

effect of adding another oven? How much would you be willing to pay to rent an additional oven? I would recommend one change in Kristen’s Cookie Company to make more cookies in less time. As the electricity cost is already covered and the most time spent in the process is in baking, Kristen should think about adding another oven. This will save almost 15 minutes on a twodozen cookie order and 34 minutes on a three-dozen cookie order if the additional oven can bake two dozen with the one, they had before to bake one dozen cookies at the same time. If there is only one oven for three dozen cookies order, the first batch will become cold by the time, the third batch is baked and that will change one of the concepts of Kristen’s Cookie business to serve fresh hot cookies. Kristen would be willing to pay $1.30 each day to rent an additional oven as this is the profit, they make by fulfilling 9 orders in one night with one oven. By baking further cookies with the added oven, they can acquire the profit and increase revenue.

Problems for Further Thought 1.What happens if you are trying to do this by yourself without your roommate? If Kristen wish to fulfill all orders by herself without her roommate, she will earn more profit without the need to share with anyone. But she will also need to be aware of the baking time and following all the process for each order from start to competition, which can divert her from the actual cookie making process. 2.Should you offer special rates for rush orders? In general, Kristen’s Cookie Company can supply fresh cookies within an hour of ordering but for rush orders, they should offer special rates. It will take at least 26 minutes to provide one dozen cookies, so for the rush orders, Kristen can add additional 25% of total price like $0.25 as the customers will be getting the cookies in half the time. 3. When should you promise delivery? How can you look quickly at orderbook and tell a caller when his or her order will be ready? How much of safety margin for timing should you allow? The delivery should be promised within the one hour of the order. Once the payment is accepted from the buyer, the buyer will know that the order is ready. Kristen can look in the orderbook and based on how many cookies the person ordered, she can tell a caller when their order will be ready. 4. What other factors should you consider at this stage of planning your business ? Kristen may think of better choosing all the different varieties of cookies and different price for each variety.

5. Your production must be made to order because each of the order is potentially unique. If you deicide to sell standard cookies instead, how should you change the production system ? The order taking process. Other policies? Nothing specific will be changed in the time spend into cookie making process but the cookies can be available in lesser time if they have been made before the order was put. The customer can get the cookies faster than the one-hour threshold....