ST.JOSEPSH’S COLLEGE OF COMMERCE (AUTONOMUS)

END SEMESTER EXAMINATION – APRIL 2012

M I B – IV SEMESTER

International LOGISTICS AND SUPPLY CHAIN MANAGEMENT

 

TIME: 3 hours                                                                                               Max.    MARKS: 100

 

Instructions:

Please manage time and write answers to the point. Avoid unnecessary and lengthy answers. Please write neatly and legibly.

Please use charts, graphs, examples to explain concepts

 

SECTION – A

1. Answer any SEVEN Questions out of NINE.              (7×5=35)

 

1. Explain JIT manufacturing and state the limitations of JIT?
2. What are the golden rules of returns management?
3. Explain the factors that influence the delivery function in SCM?
4. State the different business models in reverse logistics?
5. What are the important drivers to efficient and effective supply chain performance? Explain with an example?
6. State the advantages of 3PL?
7. What are the variables that need to be considered to improve customer service and how do you manage them?
8. Define and Explain Value Chain Management?
9. Explain with examples, how demand can be segregated into different categories.

 

SECTION-  B

1. Answer any THREE Each carries 15 marks.                               (3×15=45 )

 

10. What is Lean thinking and manufacturing? How is it different from agile manufacturing? Describe the 7 wastes?
11. Define and Discuss MPS / MRP / CRP and DRP as planning concepts of manufacturing in managing supply chain?
12. Define warehouse planning and operations process? Describe the different formats of warehouses?
13. What are the common reasons for out sourcing the SCM function? Why do these relationships fail?
14. Explain the concept of category sourcing? How can you segment the sourcing process to develop a strategy and mitigate the risk?

 

SECTION – C

• COMPULSORY question – Case Study               (20 marks)

 

Mr.Ashok Thampi, the owner of Bangalore Electronic Hardware Audio and Video Enterprises (BEHAVE) was happy to receive the “Best Retailer Award”. BEHAVE sold 300 Samsung television sets in the month of March 2012. This was an all time record as BEHAVE normally use to sell about 100 TV’s a month in the past. BEHAVE clocked a turnover of Rs.30 Lakhs in March, a 200% jump against the normal monthly turnover of Rs.10 Lakhs.

Samsung Electronics had unleashed a marketing blitz and demand had suddenly shot up. George the Marketing Manager at Samsung – Bangalore estimated that he would sell about 50000 TV’s in the year (April 2012 to March 2013) and expected BEHAVE to sell about 3600 TV’s in this period. This all round optimism of good sales was fuelled by IPL, Wimbledon, Olympics, New family drama’s, Latest Movies and also a reduction in the sales tax for TV’s.

 

Samsung wanted to achieve an all time record of 1 million Televisions in a year and wanted to beat stiff competition from players like LG, Phillips, Sony, Panasonic and other local players. Samsung had informed all its managers in India that the factories would take 15 days to service orders in the normal course but with the sudden spurt in demand there could be a delay of 10 days.

 

In order to motivate the retailers, Samsung offered a special 20% margin against the normal 10% that the television industry offered to trade. They also added other goodies like a fully paid holiday in Thailand for the retailers who achieved targets, plus cash incentives to sales staff at the retailer stores, etc. It was also decided to reduce the service level from 95% to 90%. To give all this Samsung wanted the retailers to accept cash on delivery as the new terms of trade.

 

All retailers had absolute confidence in Samsung to pull off their ambitious goal of 1 Million Televisions. George explained that he would be affecting 4 equal lots of the annual estimated sales for each retailer, so that no retailer would miss the win-win situation. Samsung charges its retailers Rs.10000 for each delivery irrespective of lot size.

 

Ashok realised that his company would be under tremendous pressure to bring in additional working capital by way of investment in stocks, and he would need larger warehousing capabilities, insurance etc. Ashok found out that he was currently incurring an annual cost of 19% for warehousing, insurance, security etc. Ashok felt it would be a good idea to get a new godown, spend a little more on upgrading the showroom, insurance, security systems etc, but this would increase his annual cost by 25%.

 

To achieve the annual sales plan, investments in a new showroom, godown, better profits, etc, Ashok realised that he had to manage his inventory cost very efficiently. Ashok felt that Samsung should affect 6 equal lots instead of 4.

 

QUESTIONS:

 

1. What is the total inventory holding cost of BEHAVE as per Samsung’s delivery plan?
2. Will the total inventory holding cost be different as per Ashok’s delivery plan?
3. What method can BEHAVE adopt to reduce cycle stock. What are the methods by which Samsung can positively influence safety stock?
4. Discuss two basic models of order cycle management? Please provide an example.
5. Why is the EOQ model unrealistic?
6. Is it sensible for Ashok to invest in a new showroom, godown, etc? Will this additional investment give Ashok some relief in inventory holding cost? Please quantify your answer in Rupees.

 

 

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