Explain the circumstance under which Martinez should employ each of the two manufacturing methods.

Martinez company | Business & Finance homework help

The two manufacturing methods that Martinez should consider are the traditional manufacturing method, which is labor-intensive and requires a large upfront investment in purchasing new equipment but can produce on demand; and the modular manufacturing method, which is cost-effective but requires additional supply chain organization.

For products with low production runs or short lead times, the traditional manufacturing method would be beneficial as it would allow for faster turnaround times due to reduced setup costs. Additionally, if Martinez needs to customize production due to customer requirements then this could also support their decision to go with the traditional approach.

On the other hand, if Martinez has larger orders or longer lead times then they may want to use the modular manufacturing method since this would enable them to better control inventory levels while still maintaining cost efficiency by leveraging off-the-shelf components from various suppliers. Furthermore, this approach can also help reduce supply chain complexity as well as logistical costs associated with storing finished goods and shipping them later on.