Power force corporation (Case Study Question 10.1 ... Power force corporation (C

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Power force corporation (Case Study Question 10.1 ... Power force corporation (Case Study Question 10.1 from the textbook Supply Chain Management by Coyle Edition 10) Kip himm, executive vice president of operations of Power Force Corporation (PFC), is feeling stressed out. The producer of power tools for the do-it-yourself market is experiencing higher fulfillment costs as retailers change their buying patterns. They all seem to want smaller, more frequent shipments to a larger number of locations. And, the retailers’ service expectations are on the rise. They are demanding advanced shipping notification, RFID tags on all products and improved inventory visibility. Gone are the days when the retailers bought power tools by the truckload for delivery to a few regionally dispersed DCs. Instead, they are asking for smaller shipments to multiple DCs and direct delivery to stores. Some retailers are also inquiring about PFC’s ability to devlier orders for individual customers direct to their homes. This drop-shipping strategy is completely new for PFC and Himmer worries that it could create major bottlenecks at the company’s centralized DC that sits next to the factory in Louisville, Kentucky. And, all of these new requirements are accompanied by shorter order cycle time goals. Himmer feels that he is stuck between a rock and a hard place as the major home improvement chain stores (Home Depot, Lowes’s and True Value) account for more than 80 percent of PFC’s sales. Although compliance is proving to be very expensive, PFC cannot afford to deny the requests. Doing so would have an unwelcome effect on revenues. After consulting with his fulfillment team, Himmer has come to the conclusion that he has three reasonable options to address the emerging marketplace requirements: Option 1 – Upgrade the existing PFC DC in Kentucky to handle multiple order types and smaller shipments. Deploy warehouse automation to improve order fulfillment speed and efficiency. Option 2- Expand the PFC fulfillment network. Add regional DCs in Nevada and New Jersey to the existing Kentucky DC. Modify operational processes and flows so that orders for DCs, stores and individual consumers can be fulfilled. Option 3- Outsource fulfillment to a capable third party logistics company so that PFC can focus its efforts on quality production, accurate demand planning, and lean inventory management. Himmer’s next step is to fully evaluate the three options and choose a path forward before his upcoming meeting with Marcia Acis, the owner of PFC. Avis will ask tough questions and Himmer must be confident in his recommendation.

Question 1: Compare and contrast the three options from the perspective of cost. Question 2: Which one do you believe will provide the most economical solution for PFC? Why?
Each need to be 2 paragraphs a piece. Power force corporation (Case Study Question 10.1 ... Power force corporation (Case Study Question 10.1 from the textbook Supply Chain Management by Coyle Edition 10) Kip himm, executive vice president of operations of Power Force Corporation (PFC), is feeling stressed out. The producer of power tools for the do-it-yourself market is experiencing higher fulfillment costs as retailers change their buying patterns. They all seem to want smaller, more frequent shipments to a larger number of locations. And, the retailers’ service expectations are on the rise. They are demanding advanced shipping notification, RFID tags on all products and improved inventory visibility. Gone are the days when the retailers bought power tools by the truckload for delivery to a few regionally dispersed DCs. Instead, they are asking for smaller shipments to multiple DCs and direct delivery to stores. Some retailers are also inquiring about PFC’s ability to devlier orders for individual customers direct to their homes. This drop-shipping strategy is completely new for PFC and Himmer worries that it could create major bottlenecks at the company’s centralized DC that sits next to the factory in Louisville, Kentucky. And, all of these new requirements are accompanied by shorter order cycle time goals. Himmer feels that he is stuck between a rock and a hard place as the major home improvement chain stores (Home Depot, Lowes’s and True Value) account for more than 80 percent of PFC’s sales. Although compliance is proving to be very expensive, PFC cannot afford to deny the requests. Doing so would have an unwelcome effect on revenues. After consulting with his fulfillment team, Himmer has come to the conclusion that he has three reasonable options to address the emerging marketplace requirements: Option 1 – Upgrade the existing PFC DC in Kentucky to handle multiple order types and smaller shipments. Deploy warehouse automation to improve order fulfillment speed and efficiency. Option 2- Expand the PFC fulfillment network. Add regional DCs in Nevada and New Jersey to the existing Kentucky DC. Modify operational processes and flows so that orders for DCs, stores and individual consumers can be fulfilled. Option 3- Outsource fulfillment to a capable third party logistics company so that PFC can focus its efforts on quality production, accurate demand planning, and lean inventory management. Himmer’s next step is to fully evaluate the three options and choose a path forward before his upcoming meeting with Marcia Acis, the owner of PFC. Avis will ask tough questions and Himmer must be confident in his recommendation.

Question 1: Compare and contrast the three options from the perspective of cost. Question 2: Which one do you believe will provide the most economical solution for PFC? Why?
Each need to be 2 paragraphs a piece.
Question 1: Compare and contrast the three options from the perspective of cost. Question 2: Which one do you believe will provide the most economical solution for PFC? Why?
Each need to be 2 paragraphs a piece.

Explanation / Answer

ANSWER:

QUESTION 1:

Contrast and Compare the Three options:

Option1:     

Ready to deal with different scope of requests . Change in the request acknowledgment process . Generally speaking productivity change. Anyway single DC in Kentucky may confront issue to take care of the clients demand, the two retailers and end client . Better transportation framework is required than take care of the demand

Option2:             

Ready to deal with assorted scope of orders, overall productivity Improvement in the request acknowledgment process. Multiple DCs In will assist PFC with meeting the clients request, the two retailers and end client Superior transportation framework may not be expected to take care of the demand .

Option3:

Presentation of Third Party calculated ,Supply Chain effectiveness will enhance through outsourcing PFC can focus on assembling quality, generation and appropriate request arranging Cost diminishment through lessening in squander by actualizing lean stock administration More consumer loyalty by giving them great quality items and on time conveyance.

QUESTION 2:

Choice 3 is the best appropriate alternative relying upon the economical solution  for PFC beacuse PFC can concentrate on manufacturing quality, production and proper demand planning Cost reduction through reduction in waste by implementing lean inventory management More customer satisfaction by providing them good quality products and on time delivery so 'option 3 is the best suitable option'

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