Inventory Management and Supply Chain Optimization

This assignment delves into various aspects of inventory management and supply chain optimization. It covers topics such as warehouse receipt systems, inventory types and their effects on sales, multimode multicommodity network design models for intermodal freight transportation, and more. The assignment aims to provide insights into the complexities of inventory management and supply chain processes, shedding light on how these elements impact business outcomes.

INSTITUTION
NAME
PROFESSOR
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Table of Contents
Topic 1:............................................................................................................................................4
A:Mediterranean Shipping Company..............................................................................................4
B. Intermodal or multimodal choice:...............................................................................................5
C. Link between inventory, warehouse and multimodal/intermodal choice...................................7
TOPIC 2...........................................................................................................................................8
A. Rational of the business:.......................................................................................................8
B.Factors determining location decisions........................................................................................9
C.Influence of location in future business expansion:...................................................................11
References......................................................................................................................................14
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EXECUTIVE SUMARY
In a chain of supply, a warehouse comes in as where goods pause; some are processed, taken
account of and packaged then supplied to the general market. It facilitates the storage of
intermediate products and in some cases transforms them into finished products. Mediterranean
shipping company is one of the world best shipping companies that offer ocean carriage services,
warehousing, and road and rail infrastructure. The facility is facilitated to suit the services
provided in the warehouse and the facilities also take care of the wellbeing of workers.
Intermodal or multimodal choice is whereby more than two modes of transport are used to move
goods from one place to another. The location of a business determines its success, MSC is
located in an area with adequate supply of raw materials, good roads security and consumers of
its products are highly concentrated in the area favorable location can make the business grow in
future while a contrary situation leads to the fall of a company. Due to its presence in the
favorable area with good road, consumers and security, it’s likely to grow in future. However
there is competition from other shipping companies around the Mediterranean region.
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Topic 1:
A: Mediterranean Shipping Company
A warehouse is an important thing in the chain of supply (Business Model Adaptation to
Institutional Voids) A warehouse can facilitate The storage of intermediate products and
transform them into finished products, could be found at any level of supply It gives room for
storage, processing, packaging and distribution of goods. Products to be stored are paused in a
warehouse under which its facilities suit the goods to be stored in the warehouse. (Tajti
(Thaythy, 2014). Goods are stored in the warehouse where they are delivered after someone
places an order through the online means and goods are paid on cash at delivery. MSC is the
number one shipping company with efficient warehouse operations and also E-business
operations in the world .MSC transports all kinds of goods ranging from food, clothes, utensils
and electronics among so many others. An international transaction via this mode is also made
easier, what one has to do is go to the internet, search their website and order for their services.
(Supporting business process analysis via data warehousing, 2011).
Warehouses play significant role in all stages of supply chain management. For example,
the manufacturers of goods receive raw materials, work-in-progress goods and spare parts from
the suppliers which the store in the warehouses. The manufacturers after manufacturing finished
goods send them to shipping companies like Mediterranean Shipping Company which again
store these goods in the warehouses (Chen, Lu and Xu, 2012). Thus, the warehouses play
significant role in the supply chain management as storage facilities of finished goods.
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B. Intermodal or multimodal choice:
Throughout the supply chain, goods have to move from one place to another and that means that
there is or there are modes and means of transport used to make goods reach their desired
destinations (MAPREDUCE RESEARCH ON WAREHOUSING OF BIG DATA, 2018). First
of all, goods move from the suppliers to the warehouse and then the goods are distributed to
various middlemen or individual customers (Atieh et al. 2016). All this is done using a variety of
transport means and modes. Intermodal or multimodal forms of transport are whereby two or
more modes of transport are used to transport a container or goods. It could be through air, water,
roads or railway. In this case, MSC services don’t always end at the port. Once the goods reach
the port, they are taken to the warehouse for storage and dispatched later to their destinations,
either by road, rail or air (Katunze et al., 2017). In addition to that, once the goods are in the
warehouse, they are ordered for by different customers some of whom could be from the
shipping country or living far away from the company which means that by the time the goods
reach them, at least two modes of transport will have been used. Say for instance, someone
orders goods from another country and wants the goods to be delivered as first as possible. The
goods will be transported by roads until it reaches the airport, from there, the goods are flown to
the destination countries through air (Chen, Lu & Xu, 2012) Therefore, one can note that more
than two means of transport could be used depending on the context and situation. This is the
intermodal or multimodal choices of transport. The choice of the intermodal or multimodal
matters to the performance of the MSC supply chain for example, when goods have been ordered
from outside country and are urgently needed, air transport shall be needed to supplement the
road transport that is used at some point of transportation. This will help the Company avail its
goods to the consumer without creating any demand shortage. Choosing road transport could
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also be a way of cutting transportation cost. The business shall be able to save money for the
future and betterment of the business. The following image shows the multimodal intermodal
forms of transport. According to Fichtinger et al. (2015), warehouse management systems play a
significant role as far as making goods available to consumers are concerned. The exporting and
shipping companies use software and data base management system to manage their stocks. The
apex management of both shipping companies and the companies owning warehouses form
strategies to manage the flow of goods in and out of warehouses. This ensures that there is
neither excess of finished goods nor neither shortage of finished goods, both of which leads to
financial losses (Hertog et al. 2014).
(Source: Chen, Lu and Xu, 2012)
C. Link between inventory, warehouse and multimodal/intermodal choice
When goods are ordered from manufacture who is the supplier to a company in different area or
location, they are shipped and brought to the warehouse first once they have been taken account
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of organized and put in order for supply, become the inventory of which the warehouse has to
manage(Sui, Gosavi and Lin, 2010). According to Qu, Bektaş and Bennell (2016), intermodal
systems of transportation of the goods are used to transport the goods from the harbor to the
destination. The intermodal freight transport system enables transport of a large number of
containers. The mode of transport used can be rail, road or sea. The intermodal system of
transporting provides bulk transport facilities and is hence more economical. Moreover, this
technique reduces damage or loss of freight which again reduces financial losses of the
transporters (Xu, Cheng & Huang, 2015).
TOPIC 2.
A. Rational of the business:
Reasons and objectives for location of business
in starting a company, the most important thing to consider is the location. The place to locate a
business matters because it will determine its performance (HE and XU, 2013). Business is
meant to make profits and not losses; therefore, locating it at a strategic place will help it meet its
objectives Mediterranean shipping company deals with offering ocean carriage storage and rail
infrastructure.
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Customers
Downstream supply chain
Upstream supply chain
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Singapore
France
Africa
Chia
The US
Sourcing

Figure 1. Figure showing logistics and supply chain
(Source: Author)
B.Factors determining location facilities:
The business organizations consider the several factors while deciding specific facilities like
manufacturing and logistics facilities. The following sections would shed light in the factors
which these business houses consider while deciding location for these specific facilities:
Availability of raw materials
MSC is situated in an area where it has access to raw materials required to run the ware house.
This is because people transport goods by means of water transport hence the location of this
company favors its practice of transporting and storing (Kim and Kim, 2016.
Consumers
The location of MSC makes it easy to reach product consumers who are their customers
(Recovered Medical Error Inventory, 2010). They supply to homes, hotels, supermarkets and
shops. All these are people who live near MSC and run their businesses the dairy therefore does
not suffer from inadequate consumers (Yang and Gao, 2014). It should be noted that most of the
people around the area deal with goods that have to be transported across the Ocean to the other
parts and also purchase goods that have been stored in the warehouse.
Transport
When locating a business, one should consider the availability and cost of transport. If transport
is a challenge, there is a likelihood that the business will not prosper as it would have prospered
in an area where there is good and cheap means of transport (Open supply? On the future of
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document supply in the world of open science, 2016). The location of MSC is favorable as it is
near the suppliers and consumers of their products. There is a good road network from Wirral to
the dairy which makes it easy to transport milk for processing. It is also cheap as the distance is
short; less money is used to avail goods. It is near the Ocean where goods are easily loaded and
offloaded to and from water vessels without much difficulty (Dykes, Rothschild and Hurley,
2010).
Employees
The objectives and reasons for establishing the company where it is situated were to get quality
employees from within. Much their employees are locals who are competent in their fields of
work. The company has employed more than 90 people whose roles are divided according to
their skills (Kim and Kim, 2016). They are drivers, marketers, food scientists, machine operator
among many others. With the locality, the employees get proper residence not far from the MSC
which makes the available at their workplace. The company has been able to provide jobs for
locals (Generating price-effective intermodal routes, 2011).
Competitors
Due to favorable conditions, it has been able to beat its competitors and gained popularity among
consumers .MSC is found where other companies are there but due to the kind of services they
offer, the storage conditional of their goods and the speed and cost of transportation, this
company has been able to beat their competitors by far (Kim & Kim, 2016). The quality of goods
they provide and the way of packaging is professional and attractive compared to their
counterparts.
Safety:
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Liu, Saat & Barkan (2017) mentions that safety is one the important issues which
business organizations consider while setting up businesses. This is because the warehouses in
which they store raw materials, WIP and finished goods have to be secured from losses like
thefts and fire. These risks cause loss of inventory and financial losses. Thus, it can inferred that
safety plays a significant role in business organizations choosing locations to conduct businesses.
Waste disposal facilities:.
According to Prakash and Poulose, E. (2016) all business organizations including the
multinational logistics companies consider waste disposal as an important criterion. Some of the
business organizations especially the ones involved in manufacturing and civil engineering
generate immense amount of wastes. These wastes cause pollution and failure to dispose them
according to law attracts legal penalty. The business organizations due to this reason hold waste
disposal as an important criteria (Dasgupta et al., 2015).
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C.Influence of location in future business expansion:
Bergqvist (2016) mentions that the facilities like consumer presence and availability of
skilled labor not only benefit the present business operations but also future business expansions.
The facilities like presence of immense consumer base can encourage the business organizations
to expand their facilities like manufacturing and logistics in particular locations. For example, if
a certain location shows signs of future increase in the demand of products, the producing
company is likely to develop a new manufacturing facility in the area to cater to the increase in
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demand. This discussion shows that factors like consumer support play significant role in future
business expansions pertaining to facilities (Dasgupta et al., 2015). However, it is not the only
company that provides the kinds of service in the area .There is other competing and small
upcoming which serve as threats to the growth of Mediterranean shipping company. With time,
the other producers are going to improve on their quality and levels of services which may attract
customers around the area leaving it with fewer customers making it difficult for it to grow (
Hanaoka et al., 2011).
If the company intends to produce more gods to cover a larger area, it will have to bring in more
production equipment which needs extra rooms for storage of inventory. Because of the available
land, the process will not be difficult (Bergqvist & Monios, 2014) .Transportation modes and
means are good due to the location of the company. There are good roads and available wagons
and trucks owned by the firm and above all, availability of water from the ocean to transport
goods across. There is minimal cost of transport as the distance between MSC and consumers are
short.It is situated in a politically stable area and high security. Political instability is what
hinders growth of any business (Roso et al., 2015). This is because when there is disturbance,
people will not settle down in the area which means there will be no consumers. Therefore, the
stable and secure condition in the area favors future improvement of the company. Supply of
power in the area is adequate and affordable. Power is needed to run most of the activities in the
warehouse and even preserve perishable goods. With the adequate and relatively cheap supply of
power, it is likely to become better in future than it is at the moment.
Warehouse layout
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(Roso et al., 2015).
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