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LM.53 In an effort to reduce costs, many regional power companies want to lower their safety stock of electricity transformers. To support this desire, a large transformer OEM will store safety stock of transformers in a FedEx warehouse in Memphis, Tennessee in order to insure quick air delivery to any of these is power companies should the need arise. This collaboration will result in lower overall inventory across the supply chain, making it possible for all parties to lower their costs. The OEM has signed up 15 power companies on this rapid replenishment program. On average, each of these power companies used to hold 33 transformers in their safety stock. In total, how many transformers would these companies hold? (Display your answer as a whole number.) Number To maintain the same service level after this transition, how many units (transformers) would the OEM need to hold (or pool) in the FedEx warehouse? (Display your answer as a whole number.) Number After making this change for these power companies and OEM, by how many units (transformers) will inventory go down? (Display your answer as a whole number.) Number By what percentage would their inventory decrease by consolidating their inventory from the dealerships into the warehouse? (Write your answer as a percentage and display your answer to the nearest whole number.) % LM.81 Monkey's Fist is trying to determine where to source their product. In the past, they have sourced solely domestically, but they have sufficiently grown to look at international suppliers. Next month's expected demand is 7,125 units. There are three suppliers to choose from, one domestic, the other two offshore. The table below contains all relevant cost data. Note that both international shipping and inland freight costs are a flat fee for a shipment of up to 18,000 units of demand-whether shipping one unit, one thousand units, or 18,000 units, the cost is the same (the flat fee). Criteria Price/Unit Packaging Cost/Unit International Shipping/Entire Shipment Inland Freight/Entire Shipment Domestic $3.83 $0.06 SO $330 Foreign 1 $2.98 $0.32 $630 $330 Foreign 2 $2.80 $0.31 $700 $260 What is the total landed cost for the domestic supplier? (Display your answer as a whole number.) Number What is the total landed cost for foreign supplier 1? (Display your answer as a whole number.) Number What is the total landed cost for foreign supplier 2? (Display your answer as a whole number.) Number Suppose actual demand is only 82% of expected demand. What would be the total landed cost of the domestic supplier? (Display your answer as a whole number.) Number At what volume of monthy demand would the total cost be the same for the domestic supplier and foreign supplier 1? (Display your answer as a whole number.) Number LM.91 XYZ Company is rethinking the way it ships to its 47 customers in another city 230 miles away. Current Shipping/Delivery Method They currently hire an LTL (less-than-truckload) carrier to pick up and deliver these shipments. Each customer order shipped via LTL carrier costs $141. Alternate Shipping/Delivery Method A 3PL (third-party logistics provider) has approached XYZ Company and suggested that they make full truckload (TL) shipments from their facility to the 3PL's warehouse in the customers' city. The 3PL would then break the bulk shipment (TL or truckload shipment) into individual customer orders to be shipped locally by an LTL carrier. The relative data for this alternate shipping method are as follows: Full TL shipment cost (230 miles) = $895 Average weight per customer order = 510 lbs. Warehouse break-bulk fee (per 100 lbs., a.k.a. per "hundred weight") = $16 Local LTL delivery fee (per customer order) = $29 What is the total cost of delivering to all customers via LTL carrier (current method)? (Display your answer as a whole number.) Number How much money would XYZ company save by using the alternate shipping/delivery method for delivery to all customers? (Display your answer as a whole number.) Number At what number of customers would the cost of these two methods be the same? (Display your answer as a whole number.) Number LM.97 Each week the ABC Company, from Albuquerque, NM receives 63 separate LTL shipments from a number of different suppliers in the Dallas, TX area. Each parcel shipment from Dallas to Albuquerque costs $141. Alternate Shipping Method A Dallas-based 3PL provider has approached ABC Company with a proposal to run a consolidation operation where they would pick up the supplier shipments each week and load them on to one truck for shipment to Albuquerque. The relative data for this alternative shipping method are as follows: Local pickup fee = $21 pickup fee Average weight per supplier shipment = 175 lbs. Local consolidation fee = $47 per hundred-weight Consolidated TL shipment from Dallas to Albuquerque = $910 What is the total cost of shipping the separate parcel shipments from the Dallas-area suppliers to the ABC company location in Albuquerque? (Display your answer as a whole number.) Number How much money would ABC Company save to hire the 3PL to pickup the shipments from each supplier and consolidate them into one bulk shipment to Albuquerque? (Display your answer as a whole number.) Number At what number of shipments is the cost the same for the two options? (Display your answer as a whole number.) Number