Deluxe Motorcar does not maintain a high inventory of tyres. Note the relatively small inventory of wheels. The company appears to be using something close to a just-in-time inventory system, which is already saving the company the cost of holding materials inventory. Nevertheless, Deluxe Motorcar’s managers would want to check why the target ending inventory of tyres (400) is greater than the beginning inventory of 350. Could the production time lag between the order of tyres placed and the ordered tyres received to reduce the need to hold more inventories? Furthermore, Deluxe Motorcar could help and advice its tyre supplier to improve the quality of its tyres by taking more quality control measures and to improve efficiency and productivity of the employees by conducting effective training programmes which may result in reduction of the cost of manufacturing tyres with a less number of defective tyres. It would certainly reduce the price the supplier charges Deluxe Motorcar. Toyota routinely aids its suppliers in this way and also reduces costs through better coordination between suppliers and the company.