Just in Time - Another Sample from the Beancounter

 “Just put the juice on the table, and please bring the liquor over here Juan.” Isaac, who has arrived at work early because today he receives the weekly inventory, points towards the top of the bar.

 “You didn’t have Gin on your list Mr. Isaac, so I brought some just in case” Juan advises.

 “That’s fine Juan; I will use it eventually.” Bringing something not on the order is something you won’t often see anywhere else.

 The two men finish unloading the supplies, then Juan heads for the door. “Hasta luego Señor Isaac.”

 During the past two years Isaac has been able to get a fairly good idea of what sells and how often. He also knows some products are often backordered depending on the season, so he makes sure he adjusts his orders accordingly allowing enough lead time. If he wants to compete with the other bars, he certainly cannot be running out of product.

 Isaac leaves the shipment on the tables for now as he needs to check on an issue at one of his rental suites. When he returns, he will finish putting it away.

 Later that afternoon…

 “Good afternoon Isaac” Carter strolls into the bar.

 “Carter! I thought you were doing community service today?”

 “I did Isaac; I’m finished.”

 “Good God man! What happened to your face?!” Isaac has just noticed a great deal of swelling on Carter’s left cheek.

 “I was on the edge of the jungle picking up garbage, and I got stung by a bee.” Carter gingerly touches his cheek which is still sore and swollen.

 “Did you get it looked at?”

 “Yes, the sergeant took me to the doctor, who gave me antihistamine and said I’d be fine.” Carter, who is rather lethargic today, wonders over towards the bar.

 “Bees! At least they have a purpose, unlike wasps!”  Isaac comments while Carter gets settled in the chair.

 “Looks like delivery day Isaac; do you need a hand putting things away?” Carter asks.

 This is a side of Carter Isaac has not seen yet; up to this point he appeared to be a young partygoer who is a little self centred. That being said, Isaac did get him out of jail yesterday. “Sure, why don’t you put the beer away, and I will take care of the rest.” The two casually start placing the bottles and cartons on their respective shelves.

 “Do you have a system for ordering Isaac?” Carter knows Isaac is a fairly organized guy therefore must have a method.

 “Absolutely, I don’t want to run out of anything, but I don’t want to tie up too much money in stock and warehousing space either.”

 “I remember studying this Isaac; Economic Order Quantity, Just-in-Time...” Carter stops putting away bottles and leans against the counter.

 “It’s all very real Carter, it’s not just theory. The only problem is knowing where to use which method and how.”

 “Why’s that?” Carter asks.

 “Well, take this bar for instance: if I knew each day I was going to sell the exact same things in a specific volume, I could use a system such as just-in-time; but I don’t know, I only have an approximation based on analysis over time. Furthermore, it changes depending on the seasons and the clients that come with them.”

 “Umm… what?” Carter looks at him confused.

 “For example, spring break, which is actually several weeks but the various schools stagger the dates, brings in a certain age group with a somewhat predictable profile; this means they are fairly consistent in what they buy. I don’t normally sell Vermouth or Cognac at spring break, and even Cosmos and Long Islands are something students will get from their all-inclusive at the resort. That being said, I do get lots of orders for Margaritas.”

 “And beer!” Carter volunteers enthusiastically.

 “Mostly beer.” The two laugh. “But you see Carter, that changes slightly during non-spring break season when I get the mid-thirties married crowd who are getting away from their children.”

 “So, you’re not making cars where you need 500 tires and rims every day 365 days per year?” Carter responds.

 “Precisely.”

 The two finish putting the way the inventory, and Carter heads for a stool to take a break.

 “Let me buy you a drink for helping out Carter.”

 “You don’t have to do that Isaac, you got me out of jail.” The two laugh as Isaac starts to make a Piña Colada for his young friend.

 “Something cold with a straw will be easier on that face.”

 “I remember working for this program in a prison that was like a sheltered workshop.”

 Of course a story must come out.

 “They made blankets and sheets mostly for the military and other prisons. We would get orders in the final quarter of the year because this is when the customers knew if they had extra money; of course, they needed delivery by the last day of the fiscal year, and we couldn’t make that much product in such short time.”

 “You didn’t keep an inventory of finished goods Isaac?”

 “No, because our policy was, we couldn’t even buy the material ahead of receiving an order.”

 “Wow!” Carter was shocked at such difficult restrictions.

 “To add to that, the material typically came from over seas as we didn’t have a great deal of sheet and blanket material being manufactured on this side of the world.”

 “Well, that’s a dumb policy!” Carter shakes his head in disbelief. “How do you run a business like that Isaac?”

 “Operating a business on a public service platform was a gallant effort Carter.”

 “I’d say!” The young man replies.

 “But Carter, there was a reason for it; even though we could recover the cost of material through sales, it was tax dollars we were laying out front, and our authorities restricted how much money could be fronted.”

 “Like an overdraft Isaac?”

 “Exactly! Even a corporation doesn’t have bottomless line of credit.”

 “So, what did you do Isaac?”

 “We looked at various alternatives such as having contracts with customers to guarantee sales, and we also tried to get suppliers to risk manage by keeping some material on this side of the ocean.”

 “How did that go?” Carter sips on his cold drink then holds the glass against his swollen face.

 “It wasn’t easy as people were risk averse.”

 “Sounds a bit tricky” Carter nods and continues sipping his drink.

 “And I haven’t even explained the procurement rules yet.”

 Carter smiles, “oh, I can imagine.”

 “People who think it’s easy working for government should try dealing with the hiring, firing, and purchasing rules.” Isaac and Carter share another laugh.

 “But did it work out Isaac?”

 “For the most part history tends to repeat itself where everyone gets the job done and everyone gets paid.”

 “Well, what’s the problem then Isaac?”

 “Things did change over time as we ended up with a government that had a different agenda, and our risk adversity grew as our budgets decreased.”

 “That can happen in business as well though.” Carter set his empty glass on the bar and turns to face Isaac.

“You bet it can Carter; the stock market went on a roller coaster from a politician who would say one thing in the morning, and another just before the markets closed.

 You know Carter, I remember a story that fits perfectly into this theme, and one you would appreciate given your run in with the bee.”

 “Do we need another drink before we start?” Carter asks thinking about the pain of the bee sting.

 “Oh, I think so.” Isaac is already one step ahead as he pours the rum into the mixer.

 “A big part of our programs in the prison system was reintegration; in particular, providing vocational training so inmates would be able to get a job when they got out of jail. We had this one site that decided to teach bee keeping.”

 “Seriously?”

 “Oh yes Carter, and this included making honey.”

 “Sweet!” Carter laughed and smiled at his pun.

 “Funny Carter, real funny.”

 “Okay, I’ll just listen.” Carter leans up against the bar to list to Isaac.

 “They found a good deal on some hives and used equipment such as hoods and gloves; they found the perfect area to set up; and after a long battle with groups such as Health and Safety, Environmental Protection, and the Vocational Committee who decided what programs provided marketable skills, they were finally ready to get going.”

 “Perfect.”

 “Almost; you see they had to get training because you don’t want to mess with bees!”

 “You’ve got that right Isaac!” Carter comments.

 “But it couldn’t be just any training; we insisted on third party certification because we wanted the inmates to get a piece of paper from a recognized educational institution versus the corrections department.”

 “Makes sense” agreed Carter.

 “Finally, after a great deal of training, experimentation, and hard work, they finally did it, they were producing honey, and it was fantastic!”

 “That’s great!”

 “Oh yes Carter, it was the best honey I ever had!”

 “So, what happened next Isaac?”

 “Well Carter, the word got out and the orders were coming in by the dozens.”

 “That sounds good.”

 “Not really - there was a problem.”

 “Problem?” Carter asks.

 “Yes, you see there was a waiting list, and it was over five years long.”

 “Five years! Why?!”

 “Well Carter, they only had seven bees!”