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IET 405: Production and Inventory Control Case study 3 (Total 20 points) Question 1: Supply Chain Management (4 points, Module 7, Chapter 17) Q.1.

I do not understand the concept of question 2, the scheduling problem.  Can someone please work this question for me?

IET 405: Production and Inventory Control Case study 3 (Total 20 points) Question 1: Supply Chain Management (4 points, Module 7, Chapter 17) Q.1. Explain the importance of ‘Supply Chain visibility’. Q.2. Explain the importance of ‘real time information’ in a supply chain? Question 2: Scheduling problem (12 points, Module 7, part 7.2) This study analyzes how a buying agent serves as an export-import link between the manufacturer of Asian goods and the retail companies in the West. The agent needs to ship fashion and seasonal apparel from Location A (Singapore) to Location B (Vancouver, Canada). The product orders are shipped from a distribution center in Hong Kong through water transportation modes. The manager of the buying agent in Location A (Singapore) must commit to shipyard (seaport) deadlines (date and time) for the order shipment. The procurement from local manufacturers in Location A are maintained to accommodate the shipping schedule, which ultimately confirms the due dates assigned by the retail companies at the location B (Vancouver, Canada). If the orders miss their scheduled dates to reach the shipyard (seaport) by a day or few hours shipping cannot be guaranteed. Once a shipment schedule is missed, it may take 2-10 businesses days to get the next scheduled shipping date. Therefore, the agent informs the cut off days to the area manufacturers based on the best shipping schedule that minimizes the shipping cost while maintaining the designated due dates set by the retail companies. The cost ($) of products is wire transferred to the Agent upon receiving the product. Therefore, some indirect holding (carrying) cost incurs during the shipment lead time period. If a shipping date is missed, this leads to additional holding cost as well as the risk of missing the retailers due date. The cut-off dates are considered the most sensitive issues to minimize shipping cost and business commitments. Assuming that the cut-off dates are maintained, the Agent must choose between two shipping companies and four alternatives. Suppose the agent ships 20 different products, a total of two million items per month, which requires about 300 containers. The shipments lead time between seaports in Location A to seaport in Location B requires 22-25 days for standard shipping and 30-32 days for basic shipping and handling.
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A decision between 2 shipping companies (shipper-X and shipper-Y) and two alternatives - standard (Std) and basic (Basic) need to be made. 15 days expedited rate: X for $7500 and Y for $7250 Shipper-X offers a 25-day (std) rate of $4400, and 32-day (basic) rate of $4000 Shipper-Y offers a 21-day (std) rate of $4600, and 30-day (basic) rate of rate of $3940 300 TEU (twenty-foot equivalent unit) containers to be shipped, each container’s estimated product value is $200,000. Annual holding cost is 30% of product-value. Answer the following: Which shipping alternative is better? (12 points, each point for each cost criteria). Show the detail of the work, only answers will get 25%. X Y Option Cost Option Cost 15 days - 15 days - 25 days - 21 days - 32 days - 30 days - Hints: Given: Q= 300 containers/month = 10 container/day Estimated product value = $200,000 per container Annual Holding Cost (H) = 30% (Estimated product value) Find, H per day = [10]*[ H/365] = $ /day Total Cost (TC) = Fixed Shipping Rate + Holding cost (H) per day *(No. of days)
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Prodct value =
Anuual holding cost =
Holding cost per day =
Holding cost per day = 10 containers per day
200000 per container
No of containers* product value of container*0.3/365...

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