At the end of 2022, Peter Parker and his management team were busy evaluating the performance of Gadgetcom for the year. Total demand had erown by over 2200 percert since business began in 2013 . This growth, however, was a mixed blessing. The venture capitalists supporting the company were very pleased with the growth in sales and the resulting surge in revenue. Peter and his team, however, could clearly see that costs would increase faster than revenues if demand continued to grew and the supply chain netwerk was not restructured. They decided to analyce the performance of the current network to see how it could be redesigned to best cope with the growth in demand anticipated over the next three years up to 2025. GADGET.COM Peter Parker founded Gadgeticom in Missoun of the United States in 2013 with a mission of supplying the techno sany millennials with affordable consumer electraric gadgets. Like any other pertshable eonsumer products, trendy electranie zadgets can become obsolete very quickly. 50 , if they are too expensive, consumers will be reluctant to purchase them. Parker's initial plan was for the cempaey to purchase the relatively cheap and trendy gadgets with acceptable quality from China and seil them over the Internet. The idea was very well received in the marketplace. Demand grew rapidly and, by the end of 2013, the company had sales of $1 million. This performance attracted some investors and soon the company received sigificaet venture capital support. At the beginning. Parker leased part of a warehouse in the outskirts of St. Louis to store and manage the products sold on the Internet, Suppliers from China sent their products to the warehouse which were received and shehed, Customer orders received via the lnternet were picked and packed and shipped by UPS from the warehouse. As demand grew, Gadget.com leased more space within the warehouse. By 2022, Gadgetcom leased the entire warehouse and orders were being shipped to customers all over the United States. Management divided the United States into six customer zones for planning purposes. As the demand grows, management was thinking of renting more warehouses in St. Louis and/or other cities. Puttirg all the warehouses in St. Louis - a centralived distribution design - might be more efficient and easier fer coordination while placing the warehouses in different cities - a decentralised distribution design might provide more responsive customer services. The total demand from 2013 to 2022 b shown in Table 1 whereas Table 2 shows the demand fram each customer sone in 2022. Parker expected that the current growth in total demand would contimue up to 2025, after which demand would level off. The growth rates were estimated to be 60%, 4026 and 20% in 2023 , 2024, and 2025 respectively. He also believed that the growth in demand would be homogeneous across the six customer sones in the next three years. In other words, the same growth rate could be applied to all the six demand zones in the same year
