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Wheeler Food in Erie, Pennsylvania, manufactures and markets snack foods. Mila Bailey manages the company's fleet of 200 delivery trucks. Bailey has been charged with
Wheeler Food in Erie, Pennsylvania, manufactures and markets snack foods. Mila Bailey manages the company's fleet of 200 delivery trucks. Bailey has been charged with "reengineering" the fleet-management function. She has an important decision to make. (Click the icon to view the decision Bailey has to make.) Assume that Bailey's records show the following data concerning Wheeler Food's fleet: (Click the icon to view the data.) Suppose that Fleet Management Services offers to manage Wheeler Food's fleet for an annual fee of $274,000. Which alternative will maximize Wheeler Food's short-term operating income? Complete the following analysis. (Enter a "0" for any zero amounts. Use a minus sign or parentheses for subtracting numbers that are typically shown enclosed in parentheses in an outsourcing decision.) Data table More info - Should she continue to manage the fleet in-house with the five employees reporting to her? To do so, she will have to acquire new fleet-management software to streamline Wheeler Food's fleet-management process. - Should she outsource the fleet-management function to Fleet Management Services, a company that specializes in managing fleets of trucks for other companies? Fleet Management Services would take over the maintenance, repair, and scheduling of Wheeler Food's fleet (but Wheeler Food would retain ownership). This alternative would require Bailey to lay off her five employees. However, her own job would be secure, as she would be Wheeler Food's liaison with Fleet Management Services
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