OPER3160 Unit #6 Case Problem You are a transportation analyst for medium sized retail distributor. You currently ship all goods by truck using an outsourced logistics company. Your company is considering building or leasing a Canadian Distribution Center because you wish to have more control over your service level. You have done some research and come up with the following data for your current customers in eastern Canada. Current Market - East Volume (tons) N-S Co-Ord E-W Co-Ord Halifax 300 4 6 Montreal 2000 5 13 Toronto 5000 20 London 500 3 21 Winnipeg 300 9 37 3.5 There is the potential for your company to expand into Western Canada with the following new locations and volumes. Yomaintain the current East locations Expansion Market - West Volume (tons) N-S Co-Ord E-W Co-Ord Regina 300 10 45 Saskatoon 200 12 46 Edmonton 450 13 53 Calgary 500 11 54 Vancouver 1000 9 63 1) Currently, based on equal outbound costs, where would be the best location for your one Canadian Distribution Center? Would you recommend this location to your company management if you continue to ship by truck? 2) With the potential expansion and based on equal outbound costs, where should your new Canadian Distribution Center be located? Does this new location make sense if you ship to all locations by truck? 3) You have discovered that the future locations in your western expansion may be able to use an outbound combination of rail & road transportation at 20 % of the cost of the current road transportation in the east. Assume the east rate is $5 per ton-km and in the west is $1 per ton- km. With this option, where should you locate your one Canadian Distribution Center? Does this location make sense? 4) What recommendation(s) would you make to your transportation manager and why? Foct OPER3160 Unit #6 Case Problem You are a transportation analyst for medium sized retail distributor. You currently ship all goods by truck using an outsourced logistics company. Your company is considering building or leasing a Canadian Distribution Center because you wish to have more control over your service level. You have done some research and come up with the following data for your current customers in eastern Canada. Current Market - East Volume (tons) N-S Co-Ord E-W Co-Ord Halifax 300 4 6 Montreal 2000 5 13 Toronto 5000 20 London 500 3 21 Winnipeg 300 9 37 3.5 There is the potential for your company to expand into Western Canada with the following new locations and volumes. Yomaintain the current East locations Expansion Market - West Volume (tons) N-S Co-Ord E-W Co-Ord Regina 300 10 45 Saskatoon 200 12 46 Edmonton 450 13 53 Calgary 500 11 54 Vancouver 1000 9 63 1) Currently, based on equal outbound costs, where would be the best location for your one Canadian Distribution Center? Would you recommend this location to your company management if you continue to ship by truck? 2) With the potential expansion and based on equal outbound costs, where should your new Canadian Distribution Center be located? Does this new location make sense if you ship to all locations by truck? 3) You have discovered that the future locations in your western expansion may be able to use an outbound combination of rail & road transportation at 20 % of the cost of the current road transportation in the east. Assume the east rate is $5 per ton-km and in the west is $1 per ton- km. With this option, where should you locate your one Canadian Distribution Center? Does this location make sense? 4) What recommendation(s) would you make to your transportation manager and why? Foct