Current ocean transportation of 50 days at a cost of .75 for transportation. The transit time is too long and you must come up with solutions to get the freight in the warehouse faster. Your target is below 15 days.
You must shop for other modes such as faster ocean or air. Your procurement person has given you a rate for faster ocean service of $1.0 but will only reduce the transit days to 25 days.
Air transportation is available at; $3.50 for Express service at 3 days, and $2.00 for deferred at 7 to 10 days transit.
The total costs for reducing transit times can't exceed more than 25% more as compared to current total costs.
What is your proposal? The SC model should be used with your answers in the spreadsheet. What will be the mode, transit times, total costs, % increase and other factors in your proposal. Prepare one slide that should contain;
a) Problem statement
b) Current costs
c) Issues/challenges
d) Proposed SC
e) Cost of proposed SC
f) Trade offs, benefits