Unit three Written Assignment

Katie Cowell

MT435 Operations Management

Kaplan University

July 23, 2012

Introduction

Albatross Anchor is a small business that began in 1976 with only four family members working there. Since then Albatross Anchor has grown from only four people to one hundred and thirty people. Albatross anchor is on a small twelve acre lot and is located in a rural suburb town of Falmouth, MA. The plant and the administrative offices are located in the same building. The plant includes the shipping department, receiving department, manufacturing, raw materials storage, finished product storage, and the foundry.

The administrative offices are defiantly needed some repairs because they are somewhat shabby, disorganized, and run inefficiently. The plant needs some repairs and some modern advances to it and production of the bell anchor and the snag hook anchor would increase in the company. In 1989, the owners decided to add on the snag hook anchor because of international competition. Technology advances and building repairs are very important at this point of Albatross Anchor. The plant no longer meets U.S. safety and environmental standards which can be unsafe for the one hundred and thirty employees that work at Albatross Anchor.

Question One
Based on the information presented in the scenario/case study discuss Albatross Anchor’s competitiveness in relation to (please address all items in the below list and provide support for your conclusions):
1. Cost a) Cost of Production: The cost of production is costs related to making or acquiring goods and services that directly generates revenue for a firm (Business Dictionary, 2012). The fixed costs of Albatross Anchor are down because they have all of their departments in one location. The manufacturing costs for the bell/mushroom anchor are $8.00 per pound and the