Graded Homework

CTU SCM210 Phase 4 Individual
Project

You were
recently hired as the VP of Logistics for the ABC Manufacturing Company. This
is a new position. During the lengthy interview process, the CEO shared her
strategic plans for worldwide growth in the company’s consumer sales.
Previously, sales had been confined to domestic sales only. As a result of
little staff logistics expertise, the company had kept the traditional
logistics model of shipping all finished products from its warehouse and
factory location on the East Coast of the United States, even though there was
a growing market on the West Coast that competition was serving from a West
Coast warehouse. However, the CEO pointed out that despite its national
popularity from a feature and quality perspective, it seemed to penetrate
poorly on the West Coast because of her need to charge higher prices as the
result of higher shipping costs.

The marketing manager tried to mitigate this competitive disadvantage by
freight equalization so that end customers would pay the same amount of
shipping costs as West Coast competition charged, regardless of where they were
located. This met with some insignificant success because timeliness of
delivery was another important issue. Therefore, the CEO had asked you, as your
first assignment, to write a white paper to address the following specific
points. She remembered that you had quite a bit of experience addressing some
or all of these issues during your career. As a stickler for formatting, she
has specifically asked you to use the following Roman numeral sections and
headings in the paper:

1. In general, what are the qualitative pros and cons for domestic sales of having multiple distribution centers and shipping locations in the United States?

The CEO is
considering three options with the same total construction and operating costs:
expanding the warehouse next to the East Coast manufacturing plant; building a
West Coast distribution center; or building a combination manufacturing and
warehouse location on the West coast given the following general information,
what are at least 5 criteria that must be considered when locating a new or
expanded shipping warehouse domestically?

1. The products are primarily medium- and
   large-size insulated coolers, like you might use for a picnic or trip to
   the beach. Transportation firms charge by space, or cubic feet, rather
   than weight, which is the more normal method.
2. The coolers are made of 3 components,
   which are all produced by suppliers solely on the East Coast; the raw
   materials to make this product are bulky, and inbound shipping from the
   East Coast suppliers currently represents 20% of total raw material costs.
3. The market is very competitive with
   generally stable or decreasing marketplace prices.
4. In states that are warm year-round, sales
   are pretty steady; in states that have seasons, 90% of sales occur in the
   May–August period.
5. Right now, to keep West Coast customers happy, the CEO says that they only charge those customers the local freight cost of shipping, which is $200 for anything up to half a truckload.
6. Describe 3 metrics that you would use to assess the success of any logistics plan involving you as a manufacturer and a mass merchandiser. Provide support for your selections.
7. Identify 3 subjective, qualitative factors to consider in the recommendation.

Provide a detailed
recommendation as to whether you should open a West Coast distribution center,
add on to the existing East Coast factory and warehouse, or build a combination
West Coast manufacturing location and warehouse? Your response must be
quantitatively based using the data in section II, the additional data below,
and from external resources as needed.

1. The products are primarily medium- and
   large-size insulated coolers, like you might use for a picnic or trip to
   the beach. Each cooler occupies 2 cubic feet of trailer truck space;
   trailers are 10 x 10 x 40’ long and cost $1,000 to ship from the East
   Coast to the West Coast.
2. The coolers are made of 3 components: 1 lb
   of raw material A, 1/4 lb of raw material B, and 1 gallon of material C,
   weighing 10 lbs. Based on this information, the added freight cost to get
   raw materials to a West Coast manufacturing location would be $0.20,
   $0.20, and $0.60 per finished-good unit, respectively.
3. The mass merchandiser location on the West
   Coast will be purchasing 10,000 units per week, but in lots of only 1,000
   at a time because of their retail store space constraints.
4. The market is very competitive, with
   generally stable or decreasing marketplace prices.
5. In states that are warm year-round, sales
   are pretty steady In states that have seasons, 90% of sales occur in the
   May–August period.
6. The raw materials to make this product are
   bulky, and inbound shipping from the suppliers to the manufacturing plant
   represents 20% of total raw material costs. These raw materials are
   supplied in the United States from the East Coast; they are not available
   elsewhere.
7. In the past, to keep West Coast customers
   happy, the CEO agreed to freight equalize customer shipping charges to be
   competitive with West Coast competition. She says that they only charge
   those customers the local freight cost of shipping, which is $200 per
   delivery for anything up to half-truckload quantities.

I have attached
the excel spreadsheet I need help filling in

What are the 3
most important points that you want the CEO to understand about this entire
decision-making process?