Ms. Esther Rumble recently graduated with a degree in Supply Chain Management fr

Question

Ms. Esther Rumble recently graduated with a degree in Supply Chain Management from the University of Miami. Ms. Kimberly Lee, her supervisor, is the General Manager of the Greater Miami Food Bank. This company collects food donations from local grocery stores and transports them back to a distribution center where they are sorted and transferred to local food kitchens that feed the needy. Due to tight budgets and growing environmental concems, it is crucial that driver capacity and fuel be used efficiently. Thus, Ms. Lee has tasked Ms. Rumble to ensure that the collection vehicles are routed in the most efficient manner. The distances in miles between any pair of stores, including the depot is shown in the table below. This company's van follows a chosen route from Monday through Saturday, each week of the year, except for a break of 2 weeks in the year. One is in June and the other one is in December. The vans run on 15 miles per gallon of gasoline. The estimated price of gasoline is $2.45 per gallon and the estimated cost for vehicle maintenance and depreciation is $0.17 per mile. Put yourself in Esther Rumble's position and answer the following questions [Please note that in the "traveling salesperson" problem which this exercise reflects, aside from the starting location to which the "salesperson returns finally, he/she visits each location only once]. DepotStore A Store B Store C Store D Store E FroimIo De Store A Store B Store C Store D Store E 10 24 26 60 48 15 40 24 60 40 26 34 46 35 20 15 48 20 15 35 35 12 (a) The route currently being used for operation is: Depot ? Store A ? Store B ? Store CStore DStore EDepot. How much does it cost the Food Bank annually to run this operation from the viewpoint of fuel and maintenance costs? [10 points] (b) Assume that the truck starts from the Depot each day and returms to the Depot each day. Using the Nearest Neighbor (NN) heuristic, determine another route for the operation and find out the percentage change in total annual fuel and maintenance costs and comment on your result. [14 points] terations are shown in red (c) If Mr. Tom Brady, the manager for Store B, suggests that the truck should start the pickup from his store every day before going to other stores and the Depot, what are the cost implications of following his suggestion (based on the NN heuristic) if. (1) the truck need not start at the Depot and end at the Depot each day [13 points] (i) there is a requirement that the truck needs to leave from the Depot initially each day and return back to the Depot each day. In other words, Store B is the first stop for the truck after it leaves the Depot every day and it is the last stop before it retums back to the Depot every day. [13 points]

Explanation / Answer

Potential of New Entrants Into an Industry

A company's power is also affected by the force of new entrants into its market. The less time and money it costs for a competitor to enter a company's market and be an effective competitor, the more a company's position may be significantly weakened. An industry with strong barriers to entry is an attractive feature for companies that would prefer to operate in a space with fewer competitors.

Power of Suppliers

This force addresses how easily suppliers can drive up the price of goods and services. It is affected by the number of suppliers of key aspects of a good or service, how unique these aspects are, and how much it would cost a company to switch from one supplier to another. The fewer the number of suppliers, and the more a company depends upon a supplier, the more power a supplier holds.

Power of Customers

This specifically deals with the ability customers have to drive prices down. It is affected by how many buyers or customers a company has, how significant each customer is, and how much it would cost a customer to switch from one company to another. The smaller and more powerful a client base, the more power it holds.

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