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Annual outage assumption

TKMC Case: Die Premiumstahl AG und der globale Beschaffungsmarkt
New answer on Sep 30, 2022
1 Answer
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Wilhelm asked on Sep 14, 2022

Hey Community,

 

for the annual supply cost analysis regarding standstill costs, the assumption that we have 1 outage per year strikes me as weird. Is that an assumption that I would think out loud and hope for an interviewer to correct me on if wrong or can we read it out somewhere ?

The units in the table do not fit, that is why I am asking. We sum up annual costs for 600 rollers per year from the 3 suppliers and add up the costs generated by one outage. Thats 1 outage of one machine and one roller. 

 

I would assume we need to include expected outages and they would differ between different suppliers, no?

 

Thanks in advance!

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Pedro
Expert
replied on Sep 30, 2022
Bain | Roland Berger | EY-Parthenon | Mentoring Approach | 30% off first 10 sessions in May| Market Sizing | DARDEN MBA

It is explicitly stated on the additional information that you have 20 / 15 / 8 shifts with downtime caused by deffective roller. And then that information is used to calculate downtime cost.

So I don't understand why you are mentioning only 1 downtime per year. I can't find that information. Where is it?

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Pedro

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