Assignment task: You are the transportation manager of a manufacturing company producing construction materials and equipment in the UAE. Two main products that your company produces are pumps for concrete, which weigh 25 kg and sell for $1000 each, and isolation bricks, which weigh 0.5 kg and sell for $10 each. Although the isolation bricks are light, they require too much space. Your main customers of both products are located in Europe. To serve your customers in that region, you own and manage a big distribution center (DC) in France. Your production plant in the UAE and the DC in France are strategically located with easy access to an airport, harbor, train station and main highways. You are preparing a report to the upper management about the transportation possibilities for these products to your DC in France.
(a) Discuss 3 possible transportation modes that you think are convenient to transport these products from your plant to your DC in France.
(b) Discuss the general advantages and disadvantages of each transportation mode:
(c) Which mode of transportation would you recommend for each product? Why?
(d) Discuss the effect of shipment frequency on transportation cost. What strategies can your company use to lower the shipment frequency? Also discuss the effect of these strategies on inventory cost.