BEER GAME Essay Example | Topics and Well Written Essays - 750 words

BEER GAME - Essay Example Furthermore, during cold weather the demand declines drastically thereby increasing the cost of manufacturing the product. Businesses exist in self-sustaining cycles. When the demand for a product changes the prices of other complimentary products some of which are useful in the manufacturing process changes as well thereby compounding the challenges facing a business, the supply of bottled water for example uses such products and services as plastic bottles, branding and transportation among others. The nature of the product makes it susceptible to climatic conditions since they influence the demand thus compounding some of the supply challenges (SILK, 2006). The transportation cost for the bottled water is likely to increase during warm water as the demand for the product increases regionally. This implies that demand increases even to the transporters a feature of the business that is likely to increase the cost of conducting business thereby increasing the price of the product. D emand for bottled water increases during special occasions such as end year parties, graduations and sports among others. The demand for the product stays either constant or declines in the absence of such social gathering. The impromptu arrangement of some of the social functions makes it challenging the supplier to increase the quantity of the product during manufacture and to organize for their transportation to the university in time. Additionally, most of such occasions last a day and attracts undetermined quantity of people. Such occasions as graduations and sports attract many people while some occasions such as seminars and class parties may not attract as much people. The periodic nature of the demand coupled with the unreliable size of the demand makes both manufacturing and transportation to the university more challenging (PRASCH, 2008). It is more challenging to change the quantity of the product for a day and organizing for their transportation to the market. The sudde n organization of some of the events makes it more difficult for the business to set up the necessary infrastructure to manufacture an increased volume and transport them to the market in time. The problem increases since the company must find market for the excessive market should it increase its production yet the demand fails to meet the quantity of the supply. Such excessive production results in losses for the business (FISHER, 2007). Graduation gowns Graduation gowns on the other hand have a more determined market. The products are essential to the students at the end of every academic year as the students adorn them in their graduation ceremonies. This implies that the supplier has a specified amount of time of both manufacture and supply to the university, additionally; the supplier operates closely with the institution. The supplier of graduation gowns therefore has a determined market. However, the business just as any other faces numerous challenges most of which arise fr om the nature of the demand (BURROW & BOSILJEVAC, 2009). The products are for example relevant only during graduations. This implies that the supplier remains out of business during the rest of the academic days. The demand for the product stays minimal during the rest of the days but rises abruptly during the graduation day. While the supplier