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Every week BosssMustang of Oakland, California, receives shipments from 5 different suppliers in the Los Angeles area. Each supplier's order weighs, on average, 900 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, 900 pounds. A direct truck shipment from Los Angeles to Oakland costs $1,100. 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 $75 per hundred-weight. The direct truck shipment cost would be the same as before, $1,100. a. Assume that each truck is capable of carrying 10,000 pounds. a. Assume that each truck is capable of carrying 15,000 pounds. The total cost of the single-order shipments from all of BosssMustang's suppliers is $ per week. (Enter your response as a whole number.) The average truck utilization level for the single-order shipment option is 2%. (Enter your response rounded to the nearest whole number.) b. The total cost of the consolidation warehousing option is $9,700 per week. (Enter your response as a whole number.) The average truck utilization level for the consolidation warehousing option is 67%. (Enter your response rounded to the nearest whole number.) c. Suppose higher gasoline prices have caused the trucking cost to increase to $1,050. The total cost of the single-order shipments from all of BosssMustang's suppliers is $ per week. (Enter your response as a whole number.) The total cost of the consolidation warehousing option is $ per week. (Enter your response as a whole number.) Given these higher gas prices, the option is the best choice
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