Assignment 1 - Logistic MODE PDF

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Warehousing, Logistics and Outsourcing Professor Jennifer Misangyi Assignment 1: Logistics Modes Mohawk College of Applied Science and Technology (2020)

QUESTION 1. As a factory of electronic components, ABC Company has been asked to look at supplying a distribution centre in Vancouver. Moving delicate, high-value electronics requires choosing transport modes able to handle the specialized needs. Current shipping destinations include Southern Ontario. (6 marks) The transportation objective is to move delicate and high-value electrical components to northern Canada (Vancouver) in a safe, efficient, effective, and low-cost manner. The proposed mode of transportation here is flight and motor carrier. The use of flight because safety of delicate components is vital. In addition, motor carrier in form of full truck loads will be used to convey material from airport to in-land destination. In addition, with proper inventory management and forecasting, deliveries can be planned of time in such a manner that the goods arrive at the point needed.

SWOT STRENGTH: Availability of ICTs and innovation, tools based on operational research methods and models for the optimization of routes and loads and lastly, availability of simple vehicle. ABC operate within Canada, costs which may have been incurred due to export duties and tariffs may not be levied upon them. Also, Canada has a good road networking system so moving delicate commodities may be easier through motor carrier as there are less bumpy roads.

WEAKNESS: Use of vehicle with limited load capacity and performance subjected to physical fatigue. Vancouver will serve as a new operational territory in the province of British Columbia for ABC, they may have to go through a learning curve which does come at a cost. Also, since we are dealing with high value commodity here, additional security service may be needed to ensure that product reach the destination safe, and this can attract extra security cost.

OPPORTUNITIES: Awareness on sustainable transportation, complexity of the last-mile segment that may affect the performance of traditional vehicles. It also involves intelligent transport system and impact-of-Just-In-Time, e-Commerce on demand economy. Promote urbanization and demographic growth. ABC Company is faced with an opportunity to expand their business by supplying a distribution centre which would help move their products to different parts of the country. This is an opportunity for them to form strategic collaborative partnership with such distributors which would be aimed at value creation rather than value extraction. This would lead to a win-win outcome for both parties as their

profits would be maximised. Also, it encourages better service from such partner (distribution company) as the begin to see ABC as part of their organization.

THREAT: Canada is known for having extreme cold temperature and snows during a significant part of the year, this could hinger ease of movement of such in-land trucking system and cancellation of flights which in turn causes delays in freighting that come at a cost. Complexities related to the impact Of climate condition on performance, competitors with higher load capacity and low environment impact (e.g., electric vans)

QUESTION 2. Leading National processor of stainless steel and aluminium alloys. With a supply network in Atlanta GA and Hamilton, ON customers are large and small and responsiveness is extremely important. Current shipping destinations include Southern USA and thorough out Canada. (7 marks) The transportation objective here is to respond to customers’ demands quickly. The proposed mode of transportation here is mostly land. A combination of trucking and rail due to it being one of the fastest modes and truckload will be recommended here. Rail for moving product over to US and truckload for movement from port to customer location in Atlanta. Alloys are light weight products which does not have negative impact on the equipment and in fractures e.g., road

SWOT STRENGTH: As national processor of steel and alloys, the company will enjoy the support of the government which might be in form of tax incentives and other f policy. There is a presence of business subsidiary in both US and Canada. This could give them an edge in terms of understanding the two regions and their logistical processes. They also enjoy variable demand from different customer size; this could help in spreading risks as when one market is not doing too well, the other may not be negatively affected and as such still provides business opportunity for the national processor.

WEAKNESS: Responsiveness is extremely important; the organization will likely incur huge freighting costs particularly to customers with low demand volumes who may be scattered around. This inefficiency could affect the bottom line of the organization; however, it is worth noting that the revenue from larger size customers may offset such losses in the long run. The US has poor railway systems which

will hinder movement of steel and alloys using train, which would have been idea due to the nature of the products and the volumes.

OPPORTUNITY: Expansion of business across the North America region over time and opportunity to foster partnership with freight companies.

THREAT: Inability to respond to all customers at the same time may lead to loss of business share to

QUESTION 2. Leading National processor of stainless steel and aluminium alloys. With a supply network in Atlanta GA and Hamilton, ON customers are large and small and responsiveness is extremely important. Current shipping destinations include Southern USA and thorough out Canada. (7 marks) The transportation objective here is to respond to customers’ demands quickly. The proposed mode of transportation here is mostly intermodal. A combination of flight due to it being one of the fastest modes and truckload will be recommended here. Flight for moving product over to US and truckload for movement from port to customer location in Atlanta.

SWOT STRENGTH: Being a national processor of steel and alloys, they will likely have the support of the government which might be in form of tax breaks or some other favourable policy. There is a presence of business subsidiary in both US and Canada. This could give them an edge in terms of understanding the two regions and their logistical processes. They also enjoy variable demand from different customer size; this could help in spreading risks as when one market is not doing too well, the other may not be negatively affected and as such still provides business opportunity for the national processor.

WEAKNESS: Since responsiveness is extremely important, the organization will likely incur huge freighting costs particularly to customers with low demand volumes who may be scattered around. This inefficiency could affect the bottom line of the organization; however, it is worth noting that the revenue from larger size customers may offset such losses in the long run. The US has poor railway systems which will hinder movement of steel and alloys using train, which would have been idea due to the nature of the products and the volumes.

OPPORTUNITY: Expansion of business across the US region over time and opportunity to foster partnership with freight companies.

THREAT: Inability to respond to all customers at the same time may lead to loss of business share to competitors.

QUESTION 3. International supply for clothing, accessories, and textiles. Our company’s experienced specialists organize transportation by all available means and through use of combined schemes around Europe, South-Eastern and Central Asia. the characteristics of their cargo, develop optimal delivery routes, and calculate costs for the transportation of light industry goods. (7 marks) The transportation objective here is centred around moving light goods such as clothing and textile across the globe. The preferred transport mode here would depend on the proximity to market as well as product type. Ideally the use of container shipments through water carriers will be recommended but if urgency arises, then flight mode would be best. For this water mode will be recommended due to its ease of accessibility globally.

SWOT STRENGTH: Accessibility to global market will be of good advantage for the company as they have access to various demands and will achieve multiple streams of revenue. Also, knowledge about the best ways to move products across the globe will be attained. WEAKNESS: Shipping is done globally, costs such as tariffs on imports and other port dues will need to be considered. Trade barriers between regions may require logistics to go through a longer process and route to avoid repercussions. This process can cause delays in freighting. OPPORTUNITY: Create an opportunity to foster partnership in Europe and Asia which will promote better business relationship between the two regions. THREAT: Delays may occur due to ocean tides and port regulations. Loss of consignments due to ship capsizing....