Chat with AIExam 8: Logistics
Compare the advantages and disadvantages of ownership of logistics assets. What factors should be considered when deciding whether to own or outsource the assets needed to execute the logistics function?
(30) 
Verified Some factors to consider include the following:
Some of the major considerations are reflected in the following questions:
Firms with low volumes or sporadic shipping needs (e.g., transport of seasonal produce)are probably better off contracting for those services.
Investing in a private fleet of trucks or network of warehouses ties up capital and commits a firm to managing those systems. While that may be fine for firms with stable supply chains, it can present a problem for firms whose markets or supply chain partners are changing rapidly. A manufacturer that wants the flexibility to quickly change from domestic to foreign suppliers probably should not own the trucks and warehouses it uses.
Core competencies were defined as organizational strengths or abilities, developed over a long period, that customers find valuable and competitors find difficult or impossible to copy. Many firms have decided that logistics is not one of their core competencies. These firms generally outsource the logistics function to common carriers (also known as public carriers), which handle shipments on a case-by-case basis, or to contract carriers, which enter into long-term agreements with firms. Another choice is third-party logistics providers (3PLs), which are service firms that handle all of the logistics requirements for other companies. Using 3PLs allows companies to focus on their core competencies yet still enjoy access to state-of-the-art logistics capabilities.
Advantages and disadvantages should be linked to the organization's expertise in logistics and their overall strategy and business plan. If the firm has no expertise in the logistics area and time (deliverability)is how they have chosen to win orders in the market, then they are probably best served by outsourcing the function. If they have the expertise or can build it quickly and see delivery speed and flexibility as important, then they might consider owning their own logistics assets.
Choose a major manufacturer and a major retailer and describe two types of warehousing each might use and why they use it.
(40) VerifiedAnswers will vary depending on examples chosen. A major manufacturer might ship goods to a cross-docking facility that will enable them to parcel out their production to several smaller locations. They might also use break-bulk warehousing for the same purpose. Both techniques would lower costs by negating the need for long routes served by trucks with very limited variety. A retailer might use cross-docking to take large shipments from many suppliers and send a small portion to each of several retail locations. A retailer might also use a hub and spoke system as part of their distribution chain. Finally, retailers can use assortment warehousing or spot stock warehousing to serve as a buffer for periods of high demand so they can fill unexpectedly large orders.
The drought of 2011 devastated hay crops in the plains states and horse owners ranged far and wide to purchase hay for their horses when winter arrived. Hay can be purchased "up north" for $4 a bale and a few entrepreneurs with large trailers were more than willing to pick up a few hundred bales and haul them south where demand was high. The transportation cost was $6 per bale and a packing and loading cost of $1 was typical. The landed cost of a bale of hay this winter was:
(42) VerifiedD
The transportation mode other than highway with the highest annual tonnage in the United States is:
(39) It looked like a scene right out of the Transformers series, albeit in a far more functional format. With the push of a button the rail car's wheels folded up into the body of the car and wheels suitable for highway transportation appeared out of nowhere. The whole process took only a minute or so and the ________ was ready to deliver steaming burritos to the growing crowd at the center of town.
(40) Plants in Vienna, Lucerne, Bruhl, and Salzburg produce the same item that is demanded by customers in London, Paris, Milan, and Athens. Customer demand and plant capacity are shown in the bottom row and rightmost column in the table. The cost to ship one unit between each combination of plants and customers is also shown in the table. The corporation wishes to minimize the total transportation costs of this assignment problem. Use the table below to answer the following question(s).
London Paris Milan Athens Total Capacity Vienna \ 19 16 3 8 600 Lucerne 15 17 17 13 500 Bruhl 13 18 18 7 400 Salzburg 16 18 18 7 470 Total Demand 500 450 620 400
-What is a suitable constraint?
(29) The Times-Picayune is searching for an ideal spotting station for the morning paper. Neighborhoods, their location on an XY grid of the city, and morning volume are shown in the table. What is the location that will minimize the transportation costs for the newspaper? Customer Annual Volume X-Coordinate Y-Coordinate Florida 250 3 7 Desire 125 7 5 Lafitte 178 1 3 Iberville 264 2 5 Guste 137 1 6 CJ Peete 55 1 4
(42) This transportation mode is often the most expensive on a per-pound basis.
(36) The crowdsourced logistics firm Fed-Ups was developed by two whiz kids that were fed up with paying the exorbitant shipping cost to deliver burritos to their parents' basements. The first month was plagued by a few problems - some participants proved incapable of locating addresses, others had a fear of the outside world, and there was a surprising amount of breakage. Still, they were encouraged as they reviewed the first month's statistics.
Total \# Orders Handled 340 \# deliveries with breakage 88 \# deliveries on time 260 \# deliveries to incorrect addresses 48 \# deliveries incomplete 12 Calculate a maximum and a minimum percentage of perfect orders using the data.
(36) The most detailed level of logistics information systems is the:
(40) The Times-Picayune is searching for an ideal spotting station for the morning paper. Neighborhoods, their location on an XY grid of the city, and morning volume are shown in the table. What is the location that will minimize the transportation costs for the newspaper? Customer Annual Volume X-Coordinate Y-Coordinate Florida 7 3 7 Desire 39 7 5 Lafitte 245 1 3 Iberville 116 2 5 Guste 55 1 6 CJ Peete 284 1 4
(33) The landed cost is the sum of all of the logistics activities from packaging at the producer's site through transportation, handling, customs, and any other logistics fees to the point of shipping.
(37) A service firm that takes care of all of the logistics requirements for other companies is a:
(28) Last year the Monroe Logistics Company reported 4,000 damaged deliveries, 1,000 deliveries to the wrong address, 500 late deliveries, and 200 deliveries billed incorrectly. Assuming no delivery had more than one error, how many deliveries were properly handled if their percent perfect order is 87%?
(38) Cross-docking is the reverse action of consolidation warehousing.
(29) Plants in Vienna, Lucerne, Bruhl, and Salzburg produce the same item that is demanded by customers in London, Paris, Milan, and Athens. Customer demand and plant capacity are shown in the bottom row and rightmost column in the table. The cost to ship one unit between each combination of plants and customers is also shown in the table. The corporation wishes to minimize the total transportation costs of this assignment problem. Use this tidy table to answer the following question(s).
London Paris Milan Athens Total Capacity Vienna \ 19 16 3 8 600 Lucerne 15 17 17 13 500 Bruhl 13 18 18 7 400 Salzburg 16 18 18 7 470 Total Demand 500 450 620 400
-Formulate an appropriate objective function and constraints to model this as an assignment problem.
(31) Plants in Vienna, Lucerne, Bruhl, and Salzburg produce the same item that is demanded by customers in London, Paris, Milan, and Athens. Customer demand and plant capacity are shown in the bottom row and rightmost column in the table. The cost to ship one unit between each combination of plants and customers is also shown in the table. The corporation wishes to minimize the total transportation costs of this assignment problem. Use this tidy table to answer the following question(s).
London Paris Milan Athens Total Capacity Vienna \ 19 16 3 8 600 Lucerne 15 17 17 13 500 Bruhl 13 18 18 7 400 Salzburg 16 18 18 7 470 Total Demand 500 450 620 400
-What is the objective function?
(39) Which of the following describes consolidation warehousing?
(37) Inventory pooling occurs when a warehouse operator fails to complete shipments and is left with inventory that should be elsewhere.
(38) 
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