$7108$IBA Supply Chain Modeling

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Disclaimer

Please note all the information and any related data presented in this document are NOT

accurate, and are not supported by any reference either. They are only provided for you

for this assessment item.

$1$ Background

In this assessment, we will work on a company called MaveriCo, which has been operating

across different cities around the world. The management team is planning to expand

to the Kingdom of Square, a new market they recently identified. MaveriCo relied on a

key component provider, Kii Supplies, for its production. In order to expand to the new

market, MaveriCo has negotiated with Kii Supplies to set up a warehouse in the Kingdom

of Square. MaveriCo also decides to set up assembly facilities in the Kingdom of Square

to quickly respond to customers.

You were assigned for this project as the supply chain manager of MaveriCo! You will need

to design a proper supply network to support MaveriCo$$s operations in the Kingdom of

Square.

$2$ Data Collection

To start with the project, you requested some data from MaveriCo. MaveriCo believes

that the demand might be related to a city$$s population, or relates to the number of years

it stayed in the city, or both. Based on this assumption, they provided some data shown

in Table $1$ for the demand information across a number of cities.

Apparently, you want to check whether MaveriCo$$s assumption is correct and use your

findings to figure out the potential demands for the cities in the Kingdom of Square.

Table $2$ presents the name, population, and the coordinates for each city. The distance

between any two cities can be assumed to be the Euclidean distance with a circuity factor

kCF of $1\mathrm{.}30.$

Your also checked with Kii Supplies about its preferred location for the warehouse. Kii

Supplies agreed to set up its warehouse based on the last digit of your student number as

shown in Table $2.$ For example, if the last digit of your student number is $5,$ Kii Supplies

will set up its warehouse in Edofield. Kii Supplies also recommended a transport company

$1$

City Population $($millon$)$ Years in City Current Annual Demand

Brisbane $2\mathrm{.}33275,000$

Chengdu $9\mathrm{.}05553,000$

Guangzhou $13\mathrm{.}14680,000$

Hobart $0\mathrm{.}27375,000$

Melbourne $4\mathrm{.}47689,000$

Moscow $13\mathrm{.}25775,000$

Perth $2\mathrm{.}03212,000$

Shanghai $24\mathrm{.}15993,000$

Sydney $4\mathrm{.}67503,000$

Tokyo $13\mathrm{.}55715,000$

Table $1$: Demand information across a number of cities.

that could manage the inbound and outbound logistics for you. The quoted transport price

is $$0\mathrm{.}005/$component$/$unit distance traveled for inbound logistics $($i$.$e$.,$ from Kii Supplies to

your assembly facilities$),$ and $$0\mathrm{.}01/$product$/$unit distance traveled for outbound logistics

$($i$.$e$.,$ from your assembly facilities to the cities$).$

City Population $($in $000)$ Coordinates $($X$,$Y$)$ Last digit of sNumber

Aresgas $1,060(501,695)1$

Brey $1,446(377,321)2$

Craford $1,320(260,382)3$

Drego $539(974,436)4$

Edofield $1,993(648,898)5$

Frila $867(387,248)6$

Gona $1,330(236,244)7$

Huling $1,070(196,852)8$

Indale $645(421,513)9$

Jemore $1,712(263,982)0$

Table $2$: Population and coordinates for each city.

To set up an assembly facility, it will cost you $$100,000$ per facility. You will need to take

this into consideration when you choose your assembly sites and design your distribution

network. To facilitate your work, you were advised to focus on the first year for the

operations in the Kingdom of Square. Each component received from Kii Supplies will be

assembled into one finished product.

$3$ The Task

You believe by now you have got all the required data and you are ready to start. Your

task will need you to use the knowledge acquired in this course, explain the rationale

behind your chosen approaches, document your analysis, and present your results to the

management team of MaveriCo.

The following list offers some ideas for you to think further $($remember this is not an

exhaustive list$)$:

$$ What will the demand look like for each city for the year to come?

$2$

$$ What determines the fixed cost for the assembly facilities?

$$ Use your sNumber to find the warehouse for Kii Supplies. What will determine how

many units you transport to each assembly facility?

$$ In which cities should you set up the assembly facilities?

$$ Which cities should be served by which assembly facility?

$$ Build different scenarios $($in terms of number of assembly facilities$)$ and discuss the

tradeoffs to be considered. For example, what will be the maximum distance you need

to travel from an assembly facility to a city? Based on these tradeoffs, recommend

your final network design structure.

You should build models for this project in an Excel spreadsheet, which will need to be

submitted as part of this assessment item. With proper model building, you can complete

this project in a stage$-$wise manner.

Please round demand information to the nearest integer $($consider using the ROUND function

in Excel$),$ and keep two deci