Solution To A Supply Chain Case Study

Buy sea freight company then you can charge yourself the $70 you target.

With out an additional study on cost of shipping the freight your target may be unreasonable.

Buy your materials only from companies that provide free shipping. Don't be surprised when these parts cost more per item, but at least the shipping will be free. Additionally the part quality, fabrication and all critical dimensions must be at least the same if not better than before. Since this homework assignment does not include any of these attributes or other shipping cost data you can clearly negotiate all of the costs away.

It is good to see new Indian management leaders will be destroying manufacturing companies just as quickly as our managers outsourced these jobs.

Glad you clarified your "free" shipping terminology by effectively saying it is included in the price. With all the different shipping companies out there, having your own logistics people sometimes really does not make sense on inbound freight.

HOMEWORK ALERT!!

Supply Chain Case Study: the Definitive Guide

Change the terms from FOB to CIF. This does not save your company any money because it merely removes the cost from your shipping budget (overhead) onto your purchasing budget (raw materials). At first sight this may not seem to be an advantage but it does allow your company to look good to your backers and bankers, by announcing at the shareholders meeting that despite increases in raw materials cost, you have reduced your internal overheads and managed to keep your sales prices constant, thus maintaining your competitive position. In senior management and accounting we call this technique "smoke and mirrors".

Yep, another example of: "Figures don't lie, but liars figure"

I have many cases of supply chain. Although the chain was outsourced to another company, I can assure you it is first quality. The manufacturing plant has personally assured us that the supply chain does not contain any sulfur, or any other corrosive materials. Additionally none of the key personnel that were manufacturing drywall at this plant were involved substantially in the production of this quality supply chain. Please submit to me the sizes of the chain that you require, and I will be glad to provide an honest price quote for the direct shipment to your facility.

Bob Cangelosi,

Sole overseas distributer for Lyn-Door Enterprises.

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