St. Joseph’s College of Commerce (Autonomous)
End Semester Examination- APRIL 2014
MIB – IV Semester
INTERNATIONAL OPERATIONS, LOGISTICS AND SCM
(IOL&SCM)
Duration: 3 Hrs Max. Marks: 100
SECTION – A
I) Answer any SEVEN questions. Each carries 5 marks. (7 x 5 = 35)
- What are the factors that determine EOQ?
- What do you understand by Vertical & Horizontal Relationships in Logistics?
- What are the Risks, which necessitate Insurance as an essential Component of Logistics? What are the different types of marine policy options available?
- Outline the Role of Freight Forwarders.
- Explain the difference between Charter Shipping & Liner Shipping?
- How does Optimised Logistics help in effective Management of Inventory?
- Derive the Contrast between Systemic control of PDM & monitoring of PDM.
- Explain the roles of ICD and CFS in international logistics?
- What do you understand by Intermodal Transportation?
- Explain the importance of a good Material Handling System.
SECTION – B
- II) Answer any THREE Each carries 15 marks. (3×15=45)
- Describe the evolution of logistics between 1960, 1980 and 2000.
- Outline in detail with practical examples from a typical industry like automotive/electronics/processed-food (choose any one industry), how Inputs, Activities & Outputs can never be isolated, but have to be closely integrated.
- Explain the concept of 3PL with a practical example. How does it differ from 4PL?
- What the role of warehouses in the logistics process? Explain few critical factors to be considered while deciding on warehouses.
- List out and discuss the emerging trends that will impact the future of international logistics.
SECTION – C
III) Compulsory Case study (1×20=20)
Sport Shoes, Inc.
Sport Shoes, Inc. (SS) is a well-established U.S. Sport shoe retailer. It sells a complete line of tennis shoes for all major sports as well as a top-of-the-line sport shoe that has become a fashion symbol with young professionals.
All of SS shoes are manufactured in the Pacific Rim and are transported to the United States in containers by water carriers. The containers arrive at the port of Long Beach, where they are transferred to a stack train for movement to its distribution centre in Indianapolis, Indiana. From its distribution centre in Indianapolis, SS despatches direct to ots 250 stores in the United States and 60 stores in Mexico. The total cycle time from Pacific Rim manufacturers to U.S. Stores is four weeks, and to Mexican stores it is seven weeks.
SS has been doing business in Mexico since 1990. It started with three stores and has expanded the business to a current total of sixty stores in Mexico’s Golden Triangle. The Golden Triangle is the region bounded by Mexico City, Guadalajara, and Monterrey. This area contains over half of Mexico’s population.
The logistics of shoes in Mexico reached a critical stage during the period of 2000 to 2001. Considerable growth in the Mexican economy, coupled with the increased importation of U.S. Goods, caused an explosion in demand for SS sport shoes. As SS increased the number of retail outlets in Mexico, it continued to logistically support these stores from its Indianapolis distribution centre. With the increased flow of goods into Mexico from the United States, the congestion at the border crossing points created longer cycle times and increases stock outs.
The growth in the Mexican economy was not matched by an equal growth in its logistics infrastructure. The border crossing points became very congested, with two to three days being the normal customs clearance time during peak periods. The Mexican highway systems consists of dirt roads (about 55%) and secondary roads (about 25%). The Mexican trucking system is dominated by many small, local companies. No U.S. Trucking companies operate in Mexico, because Mexican law prohibits foreign ownership of Mexican trucking companies, and this has helped. In the near future, NAFTA will permit 100% ownership by foreign investors of Mexican Trucking companies that are hauling foreign merchandise.
Given the growing demand for SS shoes in Mexico, top management has made a strategic commitment to remain in Mexico. Also, top management has made it a high priority to solve the long cycle time for shoes going to the stores in Mexico.
Questions:
- Describe the logistics supply chain for shoes distributed in the United States and in Mexico. What are the major similarities and differences?
- What changes would you recommend to the logistics system supporting the Mexican market?
- In 1995 the Mexican government devalued the peso by 50% against the U.S. Dollar. This devaluation had a very negative impact on the demand for U.S. Goods in Mexico. How would a similar monetary action affect your recommended logistics systems for shoes in Mexico?
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