Long term cost reduction strategies for SDFPI

Date of Publication

2011

Document Type

Bachelor's Thesis

Degree Name

Bachelor of Science in Business Management

College

Ramon V. Del Rosario College of Business

Department/Unit

Business Management

Thesis Adviser

Aida Velasco

Abstract/Summary

SDFPI is a manufacturing firm committed to producing molo siomai wrappers to sell to customers south and north of manila. Their only factory is located in Las Pinas City right beside their only warehouse. During the past few years, their purchases have gone up due to the steady rise of prices for flour and for gas. Flour is the main ingredient for the production of the wrappers and gas used for delivering their products to their customers. With their costs increasing as the prices of flour and gas increase, the company’s profitability decreases and becomes less profitable. This is the problem that the group plans to address in the paper, the company’s profitability decreasing. The group plans to give out recommendations to the company for them to be able to improve and reduce their costs better. For this to happen, the group applied different types of mathematical analysis tools like moving average forecasting to be able to forecast the demands for the last quarter of the year 2011, ingredient mix to see what mix would give out the most benefit in minimizing the costs of the company in their production, cost-benefit analysis for the new equipment and the new warehouse that the company would be recommended to buy or rent, and net present value analysis for the new warehouse, the Ishikawa diagram to be able to find out what the main problems of the company and be able to address them properly. And lastly, is the SWOT/TOWS analysis to see the different strategies that the company should apply to better the company concerning the problems found in the Ishikawa diagram. The data that was gathered began from the year 2008 up until September of the year 2011, and we collected data that concerned their purchasing like the purchases from the suppliers, the suppliers themselves and the price of the raw materials. For the data concerning the processing, we asked the company to give us data about their processing mix, and the number of stations they have in the factory. And lastly for the distribution, we gathered data like the number of vans they have, how much it can hold and the list of their customers. Unfortunately, some data was deemed confidential so we weren’t able to show it and place it in the paper. The operational framework would show the independent variables being the data that the group has collected, and the dependent variables being the profit margin of the company itself, being dependent on the purchases, processing and distribution of the company. After analysis of the data and usage of the tools, the group gave out recommendations to change the processing mix that the company is presently using to the one that we were able to come up with, to buy new equipment since their present equipment is out of date and lastly to buy or rent a new warehouse to be able to cut down on costs regarding their gas consumption and delivery costs.

Abstract Format

html

Language

English

Format

Print

Accession Number

TU16725; CDTU016725

Shelf Location

Archives, The Learning Commons, 12F, Henry Sy Sr. Hall

Physical Description

1 computer disc ; 4 3/4 in.

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