We received a new piece of business from one of our chemical manufacturers and n

Question

We received a new piece of business from one of our chemical manufacturers and need your help determining where to store goods for these customers. All goods are manufactured in Louisville, KY. Here is the customer list:

1) Your budget allows you to put a warehouse in only one location, where would you have your warehouse? a. Why is this the best spot to store these products? b. Are there any drawbacks to this location?

2) Find 2 potential third party warehouses (3PLs) to store the product located near your chosen location. Provide a quick summary of each location and recommend one.

3) If given the opportunity to get perfect data, what other information would you want to know before deciding where to locate your warehouse.

Name Location Lbs ordered/year Addison Co Indianapolis, IN 15000 Craig Co Charleston, WV 2500 Ted Co Cleveland, OH 40000 Mr I co Chicago, IL 25000 Make man Co Houston , TX 5000 Liz Manfucatrer Detroit, MI 8000 To Manufacture Los Angeles, CA 10000 Inc co Minneapolis, MN 1000 Rebecca Co Minneapolis, MN 4000 Snap Unc Inc St. Louis, MO 15000

Explanation / Answer

1. when we choose a warehouse location we ensure a location that can serves other locations as well without adding too much cost to the company. when we the location of the above mentioned places on map, two best choices can be St Louis or Indianapolis as they can provide optimal route to other locations. drawbacks can be the cost of transportaion to Houstan and Los Angeles becuase of distance and the shipping order at these places are not the highest quantity but these locations can serve other locations at optimal cost.

2. 3PL service can be provided in Chicago and Cleveland because of high shipping order quantity. since these locations can also serve nearby locations like Detroit, Charleston, Minneapolis so choosing these locations can help in optimizing the shipping and holding cost.

3. To optimal the stroing cost, i would like to have data like rental cost, labor cost, holding cost, shipping cost, turnover ratio to better comment for this question. these informations will help me in finding the total cost, optimal order and other necessary warehouse related information.

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