How much is the transportation cost

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Reference no: EM13318506

Determine Below Questions based on:

Order lot size: 5000 units

Annual Demand: 320000 units

Glass Panel Weight: 12 lbs

Order processing cost: $155 per order

Inventory carrying rate: 12% per year

Unit Price 1 to 2000 units/order Supplier 1: $50 Supplier 2: $45

Units Price 2001 to 2999 units/order 1: $45 2: $43

Unit Price 3000+ units/order 1: $40 2: $39

Tooling Cost 1: $10000 2: $16000

Distance 1: 200 miles 2: 250 miles

Supplier Defect Rate 1: 4% 2: 2%

Truckload TL(greater/equal) 40,000 lbs : $1.25 per ton-mile

Less-than-truckload: $2.05 per ton-mile

Note: per ton-mile: 2000 lbs per mile

1. Will you use truckload or less than truckload rates?

2. How much is the transportation cost (for both)?

3. Which Supplier has a lower combined tooling and quality cost?

4. How much would you save by choosing the correct supplier (based on Question 3)?

Reference no: EM13318506

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