Company Background
You are the CEO of the Middle East Division of El Deporte,an international, Spanish based, companyengaged in retailing sports clothing and sports footwear.
You are based in Dubai (Jebel Ali) where you have a Regional Distribution Centre which is used as a means of supplying your customers across the GCC region. Goods are imported from two established suppliers:
- Sports Clothing-Algeciras,Spain
- Sports Footwear-New York,USA
The products are despatched in 20ft sea containers. A small percentage of goods are transported by air when there is a requirement for goods to be dispatched urgently.
The Distribution Centre in Dubai typically holds the following inventory levels:
- Sports Clothing 4 weeks cover
- Sports Footwear 6 weeks cover
The company's sales across the globe have grown significantly and the two factories supplying the Middle East have been running at full capacity for some time. As a consequence you have been asked to look for alternative suppliers.
1 Benchmarking
Discuss what factors you would expect your Sourcing Manager to consider with a view to benchmarking possible suppliers against each other.
2Logistics
Assume after carrying out the benchmarking exercise it is decided to source the products from factories in the following locations:
- Sports Clothing - Mumbai, India
- Sports Footwear- Sao Paulo, Brazil
As these new suppliers do not have experience of supplying the Middle East you have requested your Logistics Manager to visit each factory and ensure that relevant logistical issues are reviewed and agreed before starting to import products from these sites. Discuss what key issues you would expect the Logistics Manager to raise.
3 Transit Times and Inventory Levels
(a) Produce a table showing the transit time by sea from your current suppliers' ports of export, Algeciras and New York, to Dubai (Jebel Ali), compared to the ports you are likely to use for exporting from Brazil and India. (Refer to www.searates.com).
(b) Based on these transit times discuss whether you would consider reviewing the level of inventory you hold in Dubai of sports clothing and sports footwear and, if so, what recommendations you would make.
Guidelines
Assignment length, 3,200 words (maximum 3,500).