COST ACCOUNTING
INVENTORY AND PRODUCTION MANAGEMENT
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
|
|
customers are preapred to wait for the delivery of their order
|
|
|
of reducing inventories by co-ordinating the delivery of materials just before they are neede
|
Detailed explanation-1: -What is the Customer Order Cycle Time Metric? This metric deals with measuring how long it takes to deliver a customer order after the purchase order is received by your company.
Detailed explanation-2: -Order cycle time refers to the average time taken to ship out an order from the time it was placed, excluding the actual shipping time. This makes it one of the most important KPIs to track in your order fulfillment process as it helps you measure the efficiency of your operations.
Detailed explanation-3: -The order-to-delivery process (ODP) is the principal means by which buyers or customers communicate with sellers, the final sale transaction is made, and cash is generated for the seller.
Detailed explanation-4: -Total order cycle time is calculated with the formula “time the order was received by customer” minus the “time the order was placed” divided by the “total number of orders shipped.” It could also be calculated as: order cycle time = (delivery date-order date) / total number of orders shipped.
Detailed explanation-5: -The customer order cycle occurs at the customer/retailer interface and includes all processes directly involved in receiving and filling the customer. The replenishment cycle occurs at the retailer/distributor interface and includes all processes involved in replenishing retailer inventory.