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1,2,3 please! Case Study Selecting Transportation Modes for China Imports Jacke Chen, vion president of China imports, was looking to design a frambwork lo-seiect tranaponation
1,2,3 please!
Case Study Selecting Transportation Modes for China Imports Jacke Chen, vion president of China imports, was looking to design a frambwork lo-seiect tranaponation modes for various products imported from China to the Unilod States. His basic options wore to pither use air froight or ocean shpping in 2B-toot containers. Ale freight was faster and moce roliabie, but ocean shipping was much cheaper. He docitfod to evaluate the shipping decision for two very different product catepories oonsumer electronics, such as smartphenes, and decorative hardware, such as door handles and tinges: China imports providod a vanefy of producte to its cusbomars from a warehouso noat tho por of Long Beach. Califomia.. The company incurred an anmuat holding cost of 25 percont ren all nyenloey hald and aimed to prowite a 98 percent cyche sarvicetovel on its products. The high level of 50 svice aligned with the tigh quailiy of products that the compathy imported. Transportation Options from China Aur freight and ocean ihipping were the two options waillable to move groduct trom China to the Unveed Statos. Auc froight chargod sto per Kiogroms shipped and tequired a minimum shipment of 50kg Besides boing tost, air fromght was also quite raliable. The akorape leod timpe on air treight was one woek, with a standard sowation of loadd time of 0.2 wooks Ocean thpping was much cheapor and cost \$1, 200 por: 20-foot container. Given that each contarier could bold up to 15,000kg, the shipping cost poe hob by ocean was mpre that a hundred times cheaper than air treight Dooan shippeng, howewer, book kanger and was less rolathle. The avorago load time using ocoan shipping was nine weeks, with a standard covition of threo weoks. Product Characteristics Wookly famand fer smarphones ayeragod 1,000 and had a standard dovation of 400 . Each smatptone cost $300 and woighed 0.1kg. The awaiobiity. Wootly dertand for decorative larshare avaragod 6,00, with a standard dowation of 1,000. Each unit of decorative hardware cest 520 and welghed, 1kg. Docorative hardiare tended totiave a long life cy cle - the company was stie soling doer handles and hingos that wore introduced more than a dechado eistion Study Questions 1. What is the arinaal cost of esirig air feight to mpert limartphones? What o the annuat cost of using ocean ahipping to impont smartphones? 2. What, the annuat cost of using air treight to mport docorative hardware? What is the annual cost of using ocean shipping to import docorative hardwaro? 3. What other tactors should be consitered in the choice of transportatign mode? What nidede would you roconmmend tor each prodict Step by Step Solution
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