Alternative Solutions to the Problem

#1
Have Rytech develop software based on the fixed-time period
model. Southern Toro would work closely with Rytech to create the
underlying decision rules of the model.
Advantages:
Rytech has experience with inventory modeling systems/software
Fixed-time period model provides room for safety stock (especially
between lead time and order receipt) customer retention
Demand is unstable the fixed time period model makes sense
Disadvantages
Fixed time period model requires more vigilance inventorying on a
monthly or weekly basis
Higher level of inventory is required higher storage costs

Alternative Solutions to the Problem

#2
By using the fixed-time period model. Southern Toro would create
their own inventory management process.
Advantages
Southern Toro should be using a more methodical way of forecasting
Southern Toro had some isues with RyTech developing their current
software it may make sense to partner with someone else or
develop their own system
Demand is unstable fixed time period model makes sense verus
basing off historical demand
Disadvantages
Southern toro does not have the inventory management experience
to develop an effective model on their own.
Southern toro may not be able to develop an effective model may
end up wasting money on storage costs with an innacurate model
(holding wrong amount of inventory)

Alternative Solutions to the Problem

#3
Base Southern Toros inventory level on the highest level of sales
during the past three yeas while taking into consideration the large
country club project that will most likely take place in April.
Advantages
Cost savings from an implementation and licensing standpoint
Cost timesavings since southern toto wouldnt have to monitor the
inventory as heavily/closely
Disadvantages
Demand is unpredictable so historical demand may not provide an
effective forecasting tool
Could lost customers if they arent satisfying customer demand

Recommendation

We recommend that Southern Toro choose solution # 1

for the following reasons:
Southern Toro needs a more methodical way of selecting
inventory levels
Underlying assumptions should be based on the fixed
time period model Southern Toro will work with RyTech
to develop

Conclusion

Using a moving average forecast at the annual level

The fixed time period model would provide Southern
Toro with enough inventory to meet customer demand ,
higher customer retention and higher revenues
Southern Toro need to ensure that all assumptiosn are
correct
Larger investment of time and money for souther Toros
perspective could pay off for them