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Bowie State University Global Transportation Management Discussion

Question Description

Please answer the following questions and show working on a piece of paper.

1) A firm has decided to build a warehouse to handle product received from two suppliers and destined for three retail locations. Rates, prices, and shipment quantities are shown below:

Supplier

Trans. rate/ton/mile

Supplier price/ton

Tons

A

1.50

250

500

B

2.00

100

1500

Market

Trans. rate/ton/mile

Market price/ton

Tons

X

1.00

400

500

Y

3.00

300

1300

Z

2.50

250

400

Assuming that all distances are in miles, use the following graph to determine the location that minimizes transportation costs:

Is your answer the best location for the warehouse? Explain why or why not.

2) The shipper is located in Oakland, CA, and the receiver islocated in New Orleans, LA. The shipment is 200 boxes of bronze powder(each box is worth $100). The actual value rate is $4 per 100pounds. The released value rate is $3 per 100 pounds and limits thecarrier’s liability to 25% of the loss. In each of the followingscenarios, the shipment was completely lost or destroyed.

a. Acommon carrier trucking company was selected based on the released value rateto transport the shipment, and the loss occurred at the carrier’s terminal asthe result of a handling mishap. The terms of sale are FOB origin point.

Who is responsible for filing the loss and damage claims?

How much is each party liable for?

Carrier:

Shipper:

Receiver:

b. Acommon carrier trucking company was selected based on the actual value rate totransport the shipment, and the loss occurred in route as the result of a theftat a truck stop. The terms of sale are FOB destination point.

Who is responsible for filing the loss and damage claims?

How much is each party liable for?

Carrier:

Shipper:

Receiver:

c. Acommon carrier trucking company was selected based on the actual value rate totransport the shipment, and the loss occurred in route as the result of atornado. The terms of sale are FOB origin point.

Who is responsible for filing the loss and damage claims?

How much is each party liable for?

Carrier:

Shipper:

Receiver:

3) Three separate shipments are being made from an Atlanta, GA supplier to our warehouse in Phoenix, AZ. Two loads, one weighing 200 pounds and the other weighing 500 pounds, are being shipped FOB origin point. The third, weighing 1000 pounds, is being shipped FOB destination point.

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a. Based on the following transportation rate information, what is the total amount that we (the receiver) will have to pay the carrier (13 points)?

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Origin
Point

Destination
Point

Minimum
Charge

Less Than
500 lbs.

At Least
500 lbs.

At Least
1000 lbs.

At Least
2000 lbs.

Atlanta

Phoenix

34560

10595

10010

9925

9800

Phoenix

Atlanta

40870

15145

13860

13390

13205

Note: rates are given in cents per 100 lbs.; the minimum charge is given in cents per shipment.

b. Using these rates instead, what is the total amount that we (the receiver) will have to pay the carrier (11 points)?

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Origin
Point

Destination
Point

At Least
400 lbs.

At Least
1200 lbs.

At Least
2400 lbs.

At Least
4800 lbs.

Atlanta

Phoenix

9765

9510

9285

—–

Phoenix

Atlanta

—–

14275

13940

13520


Note: rates are given in cents per 100 lbs.

4) A manufacturer in Philadelphia, PA has three customers: one in Columbus, OH, one in Indianapolis, and one in St. Louis, MO. The Columbus customer has ordered 10,000 pounds, the Indianapolis customer has ordered 10,000 pounds, and the St. Louis customer has ordered 10,000 pounds. Applicable LTL and TL (minimum 20,000 pounds) rates are shown below:

LTL

TL

Columbus

$4.5 per 100 pounds

$3 per 100 pounds

Indianapolis

$7.5 per 100 pounds

$6 per 100 pounds

St. Louis

$10.5 per 100 pounds

$9 per 100 pounds

The transportation carrier offers stop-off service with a stopping-in-transit charge of $300 per intermediate stop. Determine the lowest transportation cost alternative for the manufacturer to satisfy these three orders.

St. Louis <————- Indianapolis <————- Columbus <————- Philadelphia

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