TOPOIL

International operations and Logistics Modifiez le style des sous-titres du masque Professor g.Reiner Spring semester 2012 THE 30TH OF April
Group 6 Arnaud Maendly Aurlien Migy Andr Nietlispach Nicolas Pisecky Marine Rochat Christine Wildmoser

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OUTLINE
INTRODUCTION

OBJECTIVES

QUESTIONS

CONLUSION

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INTRODUCTION (1/2)
TOPOIL
24t/year MEDIUM CUSTOMER

8t/year SMALL CUSTOMER

India na

60t/ye ar

Nashvil le LARGE CUSTOMER

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INTRODUCTION (2/2)
Current Situation Truck capacity : 12 tons Cost per truck : 800$ Cost per stop : 250$
CUSTOMER Demand per yeas R Cost per order S Cost per ton C Holding cost per ton H=0.25*C SMALL 8 tons $1,050 $10,000 $ 2,500 MEDIUM 24 tons $1,050 $10,000 $ 2,500 LARGE 60 tons $1,050 $10,000 $ 2,500

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OBJECTIVE
Aggregate deliveries to Nashville

MEDIUM CUSTOMER

+ +

SMALL CUSTOMER

India na

Nashvil LARGE le CUSTOMER

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QUESTIONS(1/4)
What is the annual transportation and holding cost if TopOil ships a

full truckload each time a customer is running out of stock? How many days of inventory is carried at each customer under this policy?

non- material cost = 8,400+45,000 = $53,400

Equation/Customers
Small 1 1*1,050=$1,050 12/2*2,500=$15,000 $96,050 (12/2*8)*365=274days Medium 2 2*1,050=$2,100 12/2*2,500=$15,000 $257,100 (12/2*24)*365=92days Large 5 5*1,050=$5,250 12/2*2,500=$15,000 $620,250 (12/2*60)*365=37 days Total

Annual order quantity=R/Q Annual transportation cost=R/Q*S Annual holding cost=Q/2*H Total cost Days of inventory=Q/2R*365

$8,400 $45,000
$973,400

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QUESTIONS(2/4)
What is the optimal delivery policy to each customer if TopOil ships

separately to each of them? What is the annual transportation and holding cost? How many days of inventory is carried at each customer under this policy?

non- material cost = 17,776.5+17,712.5 = $35,489

Small sqrt(2*1050*8/2500)= 2.59 tons 8/2.59=3.08 orders/year 3.08*1,050=$3,234 2.59/2*2,500=$3,237.5 (2.59/2*8)*365=59 Medium sqrt(2*1050*24/2500)= 4.49 tons 24/4.49=5.35 orders /year 5.35*1,050=$5,617.5 4.49/2*2,500=$5,612.5 (4.49/2*24)*365=34 Large sqrt(2*1050*60/2500)= 7.09 tons 60/7.09=8.5 orders/year 8.5*1,050=$8,925 7.09/2*2,500=$8,862.5 (7.09/2*60)*365=22 Total

Equation/Customers
Optimal order quantity= Q*= sqrt(2SR/H) Optimal order frequency n*=R/Q* Annual transportation cost= order frequency*S Annual holding cost= Q*/2*H Days of inventory=Q*/2R*365

$17,776.5 $17,712.5

days

days

days

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QUESTIONS(3/4)
What is the optimal delivery policy to each customer if TopOil

aggregates shipments to each of the three customers on every truck that goes to Nashville? What is the annual transportation and holding cost? How many days of inventory are carried at each customer under this policy?

non- material cost = 13,350+13,345.5 = $26,695.5 Annual transportation cost=8.61*1,550=$13,345.5

S*

= S + sL + sM + sH = 800+250+250+250 =$1,550

n*

= Sqrt[(DLhCL+ DMhCM+ DHhCH)/2S*] = Sqrt[( 8*2500+ 24*2500+ 60*2500)/2*1550] = 8.61 orders

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QUESTIONS(3/4) cont.

Equation/Customers
Demand/year D or R Order frequency n* Optimal order size Q*= D/n* Cycle inventory Annual holding cost=Q*/2*H Average flow time=Q*/2/D Days of inventory= Q*/2R*365

Small 8 tons 8.61/year 8/8.61=0.92 ton 0.46 0.46*2,500=$1150 3.00 weeks (0.92/2*8)*365=21

Medium 24 tons 8.61/year 24/8.61=2.79 tons 1.395 1.395*2,500=$3,487.5 3.03 weeks

Large 60 tons 8.61/year 60/8.61=6.97 tons 3.485 3.485*2,500=$8,712.5 3.03 weeks

Total

$13,350

days

(2.79/2*24)*365=21

days

(6.97/2*60)*365=21 days

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QUESTIONS(4/4)
Come up with a tailored policy that has lower costs than the policies in

(b) or (c)? What are the costs and inventories for your suggested policy?

Description : Selected subsets of products on each truck

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QUESTIONS(4/4) cont.

The annual transportation cost =9.37*800+9.37*250+9.73*250+4.685*250 =$13,352.25 The annual holding cost is =2,137.5+3,200+8,000 =$13,337.5 non- material cost = 13,350+13,345.5 = $26,695.5

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CONCLUSION
By optimizing the order frequency and the order size,

we can improve our costs our costs

Aggregating transportation diminishes significantly If the demand pattern was more complex a tailored

policy could have been a better alternative

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REFERENCES
OLOGINT_Unit_8

CHAPTER 1O Managing Economies of Scale in a

Supply Chain

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Thank you for your attention! Questions?

Modifiez le style des sous-titres du masque

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