CASE STUDIES IN LOGISTICS (Prof Parshuram - 26606780/26605814) Super Dolls is a toy manufacturing company which is in the business for

the past two decades. Case Study No. 1 Case Study No. 1 Super Dolls is a toy manufacturing company which is in the business for the past two decades. The manufacturing unit is situated in Mumbai, while its sales and marketing are spread over a large geographical area, especially in the major cities across the country. Over the years, a number of competitors have sprung in the field. Far from child's play, the company found that the toys' sector is a tough business. Some of the problems faced by it are: There is a massive sale during the festival seasons. If the company's product is delayed, the valuable market is missed. "Fashion" or "cult" status products influence the market. Any wrong decision in this matter, means loss of sales and build-up of unwanted inventory There are high marketing and promotional costs. If these programmes go out, the sales drop massively Any misjudge of the market can also mean closing down of the company The company has problems regarding stock holding at its distribution centers. This is mainly due to wrong inputs from feedbacks and improper surveys. The company relies mainly on hired fleet of road transport. The services are not up to the mark in terms of delivery schedules, safety of goods from pilferage/theft, and mishandling of product. Marketing strategies are far from adequate. They are not effective enough to counter the strategies adopted by the competitors. You are called upon by the management of Super Dolls to head their logistics operations.You are required to study and guide the company regarding the following matters. a) Warehousing at distribution centers and large retailers to cut down inventory costs plus other suggestions in order to reduce inventory carrying costs b) Advantages of outsourcing in terms of preparing girls' and boys' toys, toys in local languages, toys for different age ranges, packaging, effecting savings on damages/transport, responding fast to customers' requests, etc. c) Alternatives with regard to having own fleet of trucks d) How to cut down cost on advertisement campaigns by alternative forms of spreading awareness e) Suggestions to counter competitors' strategies

Case Study No. 2 The management of Yummy Noodles Company was contemplating on introducing 200 grams pack of savory noodles into the Indian market at Rs. 10 per pack. This was only for one month which was construed to be as a test marketing period. During this period, the Company wanted to have a "blitz" strategy of flooding the market with their product. In the subsequent month, the management of Yummy Noodles Company had planned to raise the price of the pack to Rs. 15, while the weight of the pack was to be fixed at 250 grams. A free gift in the form of a plastic bowl with a spoon was also planned. Two months before the launch of the actual production, the marketing department of the company brought out advertisements regarding the savory noodles. The advertisements were displayed on bill-boards, TV, radio, print media. Schools and colleges were also targeted to rope in students and children to buy the product. Production of the noodles was planned to be started along with the marketing program.

Page 15 Prof Parshuram 26606780/26605814 Case Study No. 20 (Mumbai Univ April 2006) In 1997, M/s Ford Motor Company set-up their plant for manufacturing of cars in India, on the outskirts of Chennai. In accordance with their purchasing philosophy, the company identified certain components for purchase from local suppliers. Currently, for this plant, the Indian supply base provides 70% content for the car. Again, about 80% of their local suppliers are situated in the vicinity of 50 kms. This proximity of a large number of suppliers has enabled the company in successfully implementing the JIT concept in their purchasing activities. The company was satisfied with its initial experience in the manufacturing of cars in India. In view of this satisfactory experience, the company decided to develop a partnership with its Indian suppliers so as to create a strong supply chin network based on stringent quality standards and engineering support from their end. At the same time, the company also has a strong supplier base situated in other countries as well. It takes advantage of this for procuring critical components like assembled engines from abroad. Thus, the critical components of the car are imported by the company. The inbound logistics of the company is handled by TVS Lead Logistics, a third party service provider. materials/components are collected from all the existing 83 suppliers who are locally situated at their four hubs situated at Delhi, Pune, Daman, and Chennai. The materials are consolidated at the four hubs. The hub at Chennai collects the required materials from the suppliers on daily basis in the form of milk run and supplies the same to the company's factory. From the remaining three hubs, the shipment of materials is received by the factory every second day. Hence, the safety stock is maintained as per the norms prescribed by the company for the supply of the materials from the three hubs. Questions: Discuss the logistical principles on which the plant of M/s Ford is functioning Enumerate the functions carried out by the hubs established by the company Explain the concept of milk runs and its operations Critically comment on the inventory policy being implemented by the company. Do you have suggestions for improvement?

You are appointed as a logistics consultant. You are required to put forward your suggestions with regard to:

Case Study No. 3 Food Savories Limited is engaged in the manufacturing of various types of fast food items that are ready-to-eat variety. It has been in the business for the past 12 years. It has its factory as well as the processing unit in Navi Mumbai. The raw materials required are mainly vegetables, chicken which the company procures from either the local vendors, or from various suppliers situated at Nasik, Pune and other districts. The required materials are procured with the help of hired transporters. However, the hired transporters do not care much about the preservation of the goods. Hence, about 20% of the goods are lost due to damage, deterioration, pilferage, etc. Again, the hired transporters are unreliable with regard to their availability as well as prompt delivery schedules. The company's products are quite popular with the customers who are situated in Mumbai, Navi Mumbai, Pune, etc. However, the company stands to lose the market due to erratic supply schedules which do not cater promptly to the customers. The packaging of the products is attractive, but it does not preserve the product for a long time. The shelf-life is only about 5 hours, if the goods are not properly refrigerated. Loss on this account is about 10%. The company has about 10 distribution centres. But there does not seem to be the much coordination between these centres. Logistical information system is not adequate. Due to this, the company is unable to expand its business. In fact, due to competition, there is fear that the company may stand to lose its existing clientele. Due to mismanagement, the company is unable to meet increase in the demands during festival seasons and holidays.

Setting-up of proper, effective logistical information system to improve coordination [Note: Discuss about Logistics as an integrated process, ensuring proper planning] Effective forecasting system to reduce inventory carrying cost, wastages, damages, pilferages [ Note: Forecasting can be in terms of door-to-door surveys, questionnaires, telephonic interviews. For markets/stores that are close-by, think of JIT strategies] Setting-up of effective purchasing and distribution system [Note: Quality control with regard to purchases is required. Prefer those suppliers who can supply goods in their own transport] Improved system of storage, handling and packaging [Note: Study warehousing, material handling system and packaging. Write/discus relevant points relating to the question.] Alternative modes of transport to reduce/eliminate wastages [Note: Study has to be made regarding capital investment in having own fleet of specialized trucks and related variable costs versus hiring specialized fleet of trucks. In case of hired trucks, agreement should be made with regard to compensation to be paid by the transport company in case goods are damaged/pilfered by them] Ways and means to tackle and counter competitors' strategies [ Note: Analysis as to why competitors are having a "cutting edge". Improvement in the company's performance vis--vis performance in inbound logistics, processing, packaging, storage/warehousing, marketing/sales programmes. Quality and taste of the product may be altered to suit various sections of customers. Different sizes of packets to suit customers' budget]