14. A company has three cement plants from which cement has to be transported to four distribution centres. With identical costs of production at the three plants, the only variable costs involved are transportation costs. The monthly demand at the four distribution centres and the distance from the plants to the distribution centres (in km) are given below: Distribution centres Plants Monthly production W Y (tonnes) A 500 1,000 150 800 10,000 B 200 700 500 100 12,000 C 600 400 100 900 8,000 Monthly demand (tonnes) 9,000 9,000 10,000 4,000 The transportation charges are ? 10 per tonne per km. Suggest optimal transportation schedule and indicate the total minimum transportation cost. If, for certain reasons, route from plant C to distribution centre X is closed down, will the transp- ortation schedule change? If so, suggest the new schedule and effect on total cost.

14. A company has three cement plants from which cement has to be transported to four distribution centres. With identical costs of production at the three plants, the only variable costs involved are transportation costs. The monthly demand at the four distribution centres and the distance from the plants to the distribution centres (in km) are given below: Distribution centres Plants Monthly production W Y (tonnes) A 500 1,000 150 800 10,000 B 200 700 500 100 12,000 C 600 400 100 900 8,000 Monthly demand (tonnes) 9,000 9,000 10,000 4,000 The transportation charges are ? 10 per tonne per km. Suggest optimal transportation schedule and indicate the total minimum transportation cost. If, for certain reasons, route from plant C to distribution centre X is closed down, will the transp- ortation schedule change? If so, suggest the new schedule and effect on total cost.

Purchasing and Supply Chain Management

6th Edition

ISBN:9781285869681

Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

Publisher:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

ChapterC: Cases

Section: Chapter Questions

Problem 5.1SC: Scenario 3 Ben Gibson, the purchasing manager at Coastal Products, was reviewing purchasing...

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Scenario 3 Ben Gibson, the purchasing manager at Coastal Products, was reviewing purchasing expenditures for packaging materials with Jeff Joyner. Ben was particularly disturbed about the amount spent on corrugated boxes purchased from Southeastern Corrugated. Ben said, I dont like the salesman from that company. He comes around here acting like he owns the place. He loves to tell us about his fancy car, house, and vacations. It seems to me he must be making too much money off of us! Jeff responded that he heard Southeastern Corrugated was going to ask for a price increase to cover the rising costs of raw material paper stock. Jeff further stated that Southeastern would probably ask for more than what was justified simply from rising paper stock costs. After the meeting, Ben decided he had heard enough. After all, he prided himself on being a results-oriented manager. There was no way he was going to allow that salesman to keep taking advantage of Coastal Products. Ben called Jeff and told him it was time to rebid the corrugated contract before Southeastern came in with a price increase request. Who did Jeff know that might be interested in the business? Jeff replied he had several companies in mind to include in the bidding process. These companies would surely come in at a lower price, partly because they used lower-grade boxes that would probably work well enough in Coastal Products process. Jeff also explained that these suppliers were not serious contenders for the business. Their purpose was to create competition with the bids. Ben told Jeff to make sure that Southeastern was well aware that these new suppliers were bidding on the contract. He also said to make sure the suppliers knew that price was going to be the determining factor in this quote, because he considered corrugated boxes to be a standard industry item. As the Marketing Manager for Southeastern Corrugated, what would you do upon receiving the request for quotation from Coastal Products?
2) Using the cost table of the transportation problem shown below, do the following: a) Develop the appropriate LP model of the problem. WAREHOUSE PLANT A B C D DEMAND 1 5 10 7 20 200 2 3 12 5 25 400 3 8 10 10 18 600 4 7 8 12 30 1000 SUPPLY 200 500 300 1000
Monczka-T rcnt Shipping is t he logistics vendorfor Handfield Manufacturing Co. in Ohio. Handfield has dailyshipments of a power-steering pump from its Ohio plant to an autoassembly line in Alabama. The value of the standard shipment is$250,000. Monczka-Trent has two options: ( I) its standard 2-dayshipment or (2) a subcontractor who will team drive overnightwith an effective delivery of one day. The extra driver costs $175.Handfield's holding cost is 35% annually for this kind of inventory.a) Which option is more economical?b) What productio n issues a re not included in the datapresented?
Explain the operational planning needed in this freight operation. Include the transport routes, scheduling, and the types of multi-modal transport required, between the production facility in Prague to the warehouse in Hidd. 2. Explain the rules and regulations the company must meet in transporting the goods, including a suitable Incoterm, in this freight operation. 3. An explanation of the costs involved in this freight operation and how you would calculate a suitable charge-out rate (without using numbers).
Keislss Inc produces refinery glass products and is about to expand its operations in sweden , where the fixed cost and the variable cost are $ 9,00,000 and $ 92 per unit. Also, the company can purchase the product by sourcing the operations to local manufacturers in sweden for $ 150 per unit and 10,000 units per annum is the demand of the country. Ascertain which option is good for the company cost wise.
JuicyJuicy Company is a dairy manufacturing company in Serdang, Malaysia. This company isthe supplier of dairy products to a number of hypermarkets in the Serdang area. It is critical thateach order be delivered (shipped) and arrive at a specified time to ensure the quality of theirproducts and a good relationship with the buyers. However, for the past two weeks the productscannot reach the location on time. Resulted to that, they are getting many complaints from thecustomers and considering to switch to other suppliers. Thus, the company must overcome theproblem as quickly as possible. (a) Recommend a suitable quality tool that could identify the problem and to monitor thebusiness performance. Please explain and justify your suggestion. (b) Develop the selected tool (answer in part (a)) to show how it can clarify all possiblecauses and solution to the issue.
4 A local authority operates over a large geographical area. The Education Department is responsible for ensuring that stocks of a certain item are kept for distribution to schools through the area on request. In order to try to ensure supplies reach the schools promptly, the department currently operates two store warehouses, which operate independently of each other. The department is trying to assess the pros and cons of merging the two store warehouses and offering a centralised facility. For one item under consideration demand is 250 items per annum via Store A and 100 items per annum via Store B. Order costs are £10 at Store A and £11 at Store B, with holding costs 20 per cent of stock value. The item costs £4 per unit. (a) Calculate the impact on costs if the two stores merge and place combined orders for this item. (b) What other factors would you want to take into account before making a decision as to whether or not to merge the two stores?
Tamara is considering venturing into the public transport system although she is unsure on whether to purchase a 35-seater minibus, a 14-seater matatu or a taxi cab. These respective vehicles have a cost of price of Sh.2.5 million, Sh.2 million and Sh. 1.2 million. The monthly collections from the vehicles would depend on the state of the economy which can be an economic boom, stagnation or recession. The probabilities of these states are 0.25, 0.45 and 0.3 respectively. The estimated monthly collections (in Shillings) are indicated in the table below: Economic Boom Economic Stagnation Economic Recession Taxi Cab 60,000 50,000 30,000 Matatu www 90,000 75,000 60,000 Mini bus 120,000 90,000 70,000 Tamara would have to borrow 80% of the money required to buy any of the vehicles at an annual interest rate of 12%. In addition, all the vehicles are depreciated at a rate of 20% p.a. on a straight line basis. No other expenses are expected apart from the tax of 30% of the annual profit.…
Q3) The Cure medical distribution center distributes urgent medical equipment for five local hospitals in Washington DC metropolitan area. Cure Medical distribution would like to invest in a new warehouse in Washington DC to minimize the total distance from five major hospitals. The coordinate of the five hospitals is given below: ( (2) 3 Great Fall (C) (47) 122 (121) Fairfax 10 We W Bu (645) -D (-20, 30)- -E (-40, -30) Colesville Fairland Calpen A (10,60) -B (10,-10) Ⓡ South Lourel stuxent search Refuge (MA A (14) tille (214) pha Bowit (00 X -C (45, -20) 201 C a) Use Solver to determine where the new warehouse should be in to minimize the total distance from 5 hospitals. What are the coordinates of the new warehouse? b) Solve your problem again to minimize the maximum distance between hospitals and the new warehouse. What are the coordinates of the new warehouse?
4. In the past, Peter Kelle's tire dealership in Baton Rouge sold an average of 1,100 radials each year. In the past 2 years, 220 and 250, respectively were sold in fall, 360 and 300 in winter, 150 and 160 in spring, and 320 and 440 in summer. With a major expansion planned, Kelle projects sales next year to increase to 1,300 radials. Part 2 Based on next year's projected sales, the demand for each season is going to be (enter your responses as whole numbers): Season Demand Fall __________
Determine how many products to ship from each factory to each warehouse, or from each factory to each warehouse and direct to each end customer, to minimize shipping cost while meeting warehouse demands and not exceeding factory supplies Explain the above scenario using the problem given below: Warehouse Capucity Factory w, W, W. (Supply) 21 16 25 13 F. F, 17 18 14 23 13 32 27 18 41 19 Requirement 6 (Demand) 10 12 15 43 Use least cost Method to solve the problem. Using Transportation method
Q2. Pharmaceutical company producing asingle product sold it through five agencies situated in different cities. All of sudden there rouse a demand for the product in another five cities that didn't agency of the company. The company is now facing the problem of deciding on how to assign the existing agencies in order to dispatch the product to needy cities in such a waythat the travelling distance is minimized. The distance between the surplus and deficit cities in kilometer is given the following table. Surplus city Deficit cities Deficit cites A1 160 130 115 190 200 B1 135 120 130 160 175 C1 140 110 125 170 185 D1 50 50 80 80 110 E1 55 35 80 80 105 Determine the optimum assignment schedule.