Question
Every week BosssMustang of Oakland, California, receives shipments from 5 different suppliers in the Los Angeles area. Each supplier's order weighs, on average, 650 pounds.
Every week BosssMustang of Oakland, California, receives shipments from 5 different suppliers in the Los Angeles area. Each supplier's order weighs, on average, 650 pounds. A direct truck shipment from Los Angeles to Oakland costs $1,200.
A Los Angeles 3PL provider has offered to run a consolidation warehousing operation for BosssMustang. The 3PL provider would pick up the shipments from each supplier, process them, and put them on a single truck bound for Oakland. The pickup fee would be $50 per supplier, and the warehousing cost would be $70 per hundred-weight. The direct truck shipment cost would be the same as before, $1,200.
a. Assume that each truck is capable of carrying 12,500 pounds.
The total cost of the single-order shipments from all of BosssMustang's suppliers is ____ per week.
The average truck utilization level for the single-order shipment option is ____%
b. The total cost of the consolidation warehousing option is $____ per week.
The average truck utilization level for the consolidation warehousing option is ___%
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