Case Goodlife club

First of all, each center do not have control of any purchasing that they make, because they use an ad hoc basis; it means that when they required something they just look for it at the nearby store, instead of maintaining an inventory inside the fitness center. Therefore, the costs of purchasing are really expensive.

The new system that Sally implemented is based on a centralized purchasing, which will allow safe considerable money for the club. Although it is a good idea, there is still a problem with three of the centers located in Dallas, which are resisting to the new system.

We believe that possible reasons of this reaction are that managers don’t want to spend time on doing an extra task asking for their centers requirements and not receiving them on time. Perhaps they are used to do things by their own instead of following determined process.

Sally is now facing many issues, not only the problem with the managers in Dallas, also the time she considered to satisfy each requisition may not be enough as she thought, because now is her responsibility to take care of the nineteen center instead of just one of them. As she is very busy trying to figure out how to ship all the orders in just one week, when she already send them, a new list of requisition is coming, so she doesn’t have time to check if her plan is working in the right way.

To solve this big problem we have though in some alternatives, first she needs to talk with the three managers in Dallas to explain better the purchasing system that she develop and explain all the benefits that this would bring. Also to explain them that keep track of inventory is needed to improve the performance of each place, and if possible reach an agreement.

Change the time of requisition is necessary, we propose that it should be once a month instead of every week. It would help Sally to check the performance of each center and be prepared for any future adversity.

We proposed to provide certain amount of pieces to each center that will help the managers and staff to keep a small inventory and get the opportunity to have a faster access to the needed piece. But at the same time keep the 100 dollars, in order to react to any urgent purchase.

The creation of a data base in which the headquarters could analyze the most demanding products in each center and also to keep control of all the inventories. And supply each center according on what they report and check the information match to the data base.

Finally we think that the supply process should be separated in three areas:

North: Waco, Dallas, Amarillo, Lubbock Center: Austin, Houston and Galveston South: San Antonio and Corpus Christi

That could help to deliver the inventories in a faster way, and because there is going to be more time between the order and the delivery process, Sally can check the performance of each center.