Supply Chain Forecasting Report

This report details a coursework project focusing on supply chain forecasting and decision analysis. It presents two case studies: the first involves optimizing the delivery system at Bullseye Department Store to reduce truck loading times, exploring options like hiring additional workers or upgrading equipment. The second case study analyzes DHL's supply chain for shipping LCD TVs across China, aiming to minimize both cost and CO2 emissions by selecting optimal transportation modes (water, road, rail, air) and ODMs based on cost and CO2 emission data. The report provides detailed mathematical formulations, calculations, and rankings for cost and CO2 emissions for both 32" and 42" LCD TVs, ultimately determining the most cost-effective and environmentally conscious shipping strategies. The final conclusion summarizes the total cost and CO2 emissions for the entire operation.

Project Management Status Report
Supply Chain Forecasting and Decision Analysis 2015-16 Coursework
Prepared by:
Date:
Introduction:
Project includes two cases; first case is related to Delivery system design at
bullseye department store designed on delaying in warehouse for loading of trucks.
Second case relates to DHL supply chain. DHL is supplying LCD’s 32” and
42”across the china through different transports methods having different cost. On
environmental issues on emission of Co2 gas they have to plan trips with minimum
cost having minimum Co2 emission.
Case 1: Delivery System Design at Bullseye Department Store (50%)
Bullseye Department store is a discount retailer of general merchandise. The
company owns 50 stores, but they are supplied from a single warehouse. Most of
the merchandise received at the warehouse arrives in trucks.
Trucks are loaded by Dock which is capitalized in warehouse and operate by one
worker. There are 8 docks available in warehouse and one dock will take 30min to
load one truck. When all docks are occupied new arriving trucks wait in a queue
until one become available.
Because of large chain of 50 stores but supplied from a single warehouse there is
heavy load on single warehouse to entertain quickly. Bullseye also receive
complaints from some trucking firms that deliveries are taking too long at the
warehouse. In order to mitigate this issue Bullseye has number of options
available.

First Option:
In order to minimize the time taken by trucks in warehouse is to hire an extra
worker for each dock, it reduces time for each truck from 30min to 18 min but it
will cost $17 per hour extra. In order to use this option Bullseye can load approx.
3.33 trucks per hour.

Second Option:
In order to minimize the time taken by trucks in warehouse is to upgrade forklift
equipment, it reduce time for each truck from 30min to 23 min but it will cost $6
per hour extra. In order to use this option Bullseye can load approx. 2.6 trucks per
hour.

Action Plan:
Bullseye hire 2 new workers and capitalized 2 new loading docks, now total docks
become 10 as per average time taken by one dock is 30 min so Bullseye can load 5
trucks in one hour, and this cost Bullseye as $46 per hour.
Analysis:
According to First option number of trucks loaded per hour got increased by 3
trucks per hour with cost of $ 17 per hour. While as per second option trucks
loaded per hour will be increased by 0.6 trucks per hour 2.6 with additional cost
of $ 6 per hour.
Bullseye use to increase number of trucks loaded per hour by 5 but it will cost
them $ 46 per hour. It means in one hour bullseye can load 5 extras truck than
before.

Case 2: DHL Supply Chain Case (50%)
DHL was the first logistic company to set a quantified the carbon efficiency goal to
improve its CO2 emission efficiency. Responsibility of DHL supply chain was to
ship LCD TV sets from ODMs (original design manufacturer) to distribution center.
ODMs are located across china and Taiwan. CEC set budget of 3 billion later after
some Economic pressure it become 3 billion as production and shipping cost for
90,000 units of LCD 42” and 530,000 units of LCD 32”. DHL is doing shipping for
CEC. There are 8 ODM’s across china and Taiwan from where Products are
manufactured and can be shipped. Mode of transport used for shipping is water,
road network, road LTL, road, rail, regular Air and Air Express. DHL had quantified
Co2 emission for each mode of shipping by using weight and KM.
(1) The mathematical formulation of the problem
For LCD 42" Cost Model
Following table show as per descending order of method of transport that can be
use as per cost effective. Water is shown as least cost hence ranked as first to be
use for shipping and so on road network, road LTL, road rail etc.
Calculation:
 Take total cost as per mode (e.g. water) multiply with number of units and
multiply with 0.022 (convert KG to Ton) for any particular ODM.
 Take total cost of all mode of shipping (e.g. Water) and divided by number
of modes available (e.g. 7 see chart above)
 Using average cost assign them rank, first one is water as lowest cost per
unit and so on.

For LCD 42" Co2 Emission Model
Following table show as per descending order of Co2 omission as per unit for
ODMs.ODM7 is shown as least Co2 omitting hence ranked as first to be use for
shipping and so onODM 6, ODM 3, ODM 2, ODM 4 and ODM 1.
For LCD 42" Co2 Emission Model
Rank CO2 Ranked Average CO2 per
Unit
1 ODM7
21,73
2
2 ODM6
21,85
9
3 ODM3
43,71
8
4 ODM2
49,19
9
5 ODM4
68,11
2
6 ODM1
79,45
3
Calculation:
 Take total Co2 as per ODM (e.g. ODM1) by multiply with total KM in each
ODM with number of units and then multiply with CO2 Emission in Kg
per Ton-Km shipped (e.g. 1.44 for Regular air).
 Take total Co2 of all mode of shipping (e.g. Water) for each ODM and
divided by number of units.
 Using average Co2 omission rank it, First one is ODM7 as lowest Co2
omission per unit and so on.

Shipping mode And ODM Use For LCD 42” :
For LCD 42" Cost base on shipping method Model
Cost
Ranked Mode
Average
shipping cost
per unit
1 Water
67.
30
2
Road-
Network
130.
58
3 Road LTL
135.
30
4 Road
158.
68
5 Rail
573.
24
6 Regular Air
2,148.
81
7 Air Express
2,358.
97
For LCD 42" Number of units as per ODM (see Calculation chart)
S.No. ODM USED
Minimum
units
Ordered
Shipping
Cost
Production
Cost Total Cost CO2 Emission
1
ODM1
(water)
600,0
00
40,803,84
0
1,190,040,00
0
1,230,843,84
0
478,800,00
0
2
ODM4
(water)
320,0
00
21,762,0
48
632,352,0
00
654,114,04
8
218,909,09
1
Total
920,0
00
62,565,8
88
1,822,392,0
00
1,884,957,8
88
697,709,0
91

ODM Selection:
ODM is selected as per limit of minimum 200,000 units and maximum 600,000 per
ODM.
Transport Channel Selection:
Transportation channel is selected as water because average cost per unit for
water is less than other channel available. There is no maximum limit to be
shipped in any channel. As of lower cost than others water is selected as medium
to transport.
Result: Total Cost for shipping 920,000 units of LCD 42” is 2,034,686,509 CNY
(chines renminbi) includes shipping cost CNY 79,502,509 and production cost as
CNY 2,034,686,509 with 19,993,881 KG per Ton-Km emission in Co2.
LCD 32” Models and Calculation
For LCD 32" Co2 Emission Model
Following table show as per descending order of Co2 omission as per unit for
ODMs. ODM7 is shown as least Co2 omitting hence ranked as first to be use for
shipping and so on ODM 2 and then ODM 1.
For LCD 32" Cost Model
Following table show as per descending order of method of transport that can be
use as per cost effective. Water is shown as least cost hence ranked as first to be
use for shipping and so on road network, road LTL, road rail etc.

For LCD 32" Cost base on shipping method Model
Cost
Ranked Mode
Average
shipping
cost per unit
1 water 16
2
road
Network 29
3 rail 28
4 road LTL 30
5 Road 36
6 Regular Air
4
96
7 Air Express
5
45
For LCD 32" Number of units as per ODM (see Calculation chart)
S.No. ODM USED
Minimum
units
Ordered
Shipping
Cost
Production
Cost Total Cost CO2 Emission
1
ODM1
(water)
530,0
00
36,043,3
92
963,540,0
00
999,583,39
2
563,920,00
0
Total
530,0
00
36,043,3
92
963,540,0
00
999,583,3
92
563,920,0
00

Result: Total Cost for shipping 530,000 units of LCD 32” is 999,583,392.00 CNY
(chines renminbi) includes shipping cost as CNY 36,043,392 and production cost
as CNY 963,540,000 with 563,920,000 KG per Ton-Km emission in Co2.
Conclusion
TOTAL COST AND Co2 Emission
LCD
Size
ODM
USE
Mode of
Transport Units Shipping
Cost
Production
Cost Total Cost CO2 Emission
LCD
32" ODM1 Water 530,000 36,043,392 963,540,000 999,583,392 563,920,000
530,000 36,043,392 963,540,000 999,583,392 563,920,000
LCD
42" ODM1 Water 600,000 40,803,840 1,190,040,000 1,230,843,840 478,800,000
LCD
42" ODM4 Water 320,000 21,762,048 632,352,000 654,114,048 218,909,091
920,000.00 62,565,888 1,822,392,000 1,884,957,888 697,709,091
TOTAL 1,450,000 98,609,280 2,785,932,000 2,884,541,280 1,261,629,091
Conclusion:
Total Cost for shipping 530,000 units of LCD 32” and 920,000 units of LCD 42” is
2,884,541,280 CNY (chines renminbi) includes shipping cost as CNY 98,609,280 and
production cost as CNY 2,785,932,000 with 1,261,629,091 KG per Ton-Km emission in
Co2.