Supply Chain Management, 5e (Chopra/Meindl) Chapter 4 Designing Distribution Networks and Applications to e-Business
4.1 True/False Questions 1) Distribution occurs between every pair of stages in the supply chain. Answer: T!" Diff: # Topic: 4.1 The ole of Distribution Distribution in the $upply %hain %hain &earning 'utco(e: %o(pare co((on approaches to supply chain esign #) %o(panies in the sa(e inustry often select very ifferent istribution networ*s+ because the choice of the istribution networ* can be use to achieve a variety of supply chain ob,ectives ranging fro( low cost to high responsiveness. Answer: T!" Diff: # Topic: 4.1 The ole of Distribution Distribution in the $upply %hain %hain &earning 'utco(e: %o(pare co((on approaches to supply chain esign -) %o(panies in the sa(e inustry shoul always select si(ilar istribution istribution networ*s+ because their ob,ectives will be si(ilar. Answer: FA&$" Diff: # Topic: 4.1 The ole of Distribution Distribution in the $upply %hain %hain 4) A custo(er oes not necessarily want the highest level of perfor(ance along all i(ensions of custo(er service+ incluing response ti(e+ prouct variety+ prouct availability+ availability+ custo(er eperience+ orer o rer visibility+ visibility+ an returnability. Answer: T!" Diff: 1 Topic: 4.# Factors nfluencing Distribution Distribution 0etwor* Design &earning 'utco(e: %o(pare co((on approaches to supply chain esign ) 'utboun transportation costs per unit ten to be lower than inboun costs+ because inboun lot si2es are typically larger. larger. Answer: FA&$" Diff: 1 Topic: 4.# Factors nfluencing Distribution Distribution 0etwor* Design &earning 'utco(e: %o(pare co((on approaches to supply chain esign 3) Transportation Transportation costs are high with ropshipping because the average outboun istance to the en consu(er is large an pac*age carriers are use to shipping the prouct. Answer: T!" Diff: 1 Topic: 4.# Factors nfluencing Distribution Distribution 0etwor* Design
9) The (ain avantage of intransit (erge over ropshipping is the so(ewhat lower transportation cost an i(prove custo(er eperience. Answer: T!" Diff: # Topic: 4.- Design 'ptions for a Distribution 0etwor* &earning 'utco(e: %o(pare co((on approaches to supply chain esign ) The (ain avantage of a istribution networ* with local storage is that it can lower the elivery cost an provie a faster response than other networ*s. Answer: T!" Diff: # Topic: 4.- Design 'ptions for a Distribution 0etwor* &earning 'utco(e: %o(pare co((on approaches to supply chain esign ;) The (ain avantage of a istribution networ* with local storage is that it can lower the inventory an facility costs. Answer: FA&$" Diff: # Topic: 4.- Design 'ptions for a Distribution 0etwor* 16) The (a,or isavantage of a istribution networ* with local storage is the increase inventory an facility costs. Answer: T!" Diff: 1 Topic: 4.- Design 'ptions for a Distribution 0etwor* &earning 'utco(e: %o(pare co((on approaches to supply chain esign 11) A istribution istribution networ* esigner nees to consier prouct characteristics as well as networ* re
14) As long as inboun transportation econo(ies of scale are (aintaine+ increasing the nu(ber of facilities ecreases total transportation cost. Answer: T!" Diff: 1 Topic: 4.# Factors nfluencing Distribution 0etwor* Design AA%$=: Analytic $*ills &earning 'utco(e: %o(pare co((on approaches to supply chain esign 1) %usto(ers always want the highest level of perfor(ance along all the i(ensions response ti(e+ prouct variety an returnability. Answer: FA&$" Diff: # Topic: 4.# Factors nfluencing Distribution 0etwor* Design AA%$=: Analytic $*ills &earning 'utco(e: %o(pare co((on approaches to supply chain esign 13) Fir(s that target custo(ers who can tolerate a long response ti(e re
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4.# >ultiple %hoice Questions 1) The steps ta*en to (ove an store a prouct fro( the supplier stage to a custo(er stage in the supply chain is referre to as A) transportation. =) retailing. %) wholesaling. D) istribution. ") (anufacturing. Answer: D Diff: 1 Topic: 4.1 The ole of Distribution in the $upply %hain AA%$=: Analytic $*ills &earning 'utco(e: %o(pare co((on approaches to supply chain esign #) Distribution is a *ey river of the overall profitability of a fir( because A) the aition of istributors only as cost to the supply chain. =) it irectly i(pacts both the supply chain co st an the custo(er eperience. %) it slows own the responsiveness of the supply chain. D) it cannot be evelope as a part of supply chain strategy. ") Distribution is not a *ey river of profitability. Answer: = Diff: # Topic: 4.1 The ole of Distribution in the $upply %hain AA%$=: Analytic $*ills &earning 'utco(e: %o(pare co((on approaches to supply chain esign -) The choice of the istribution networ* can b e use to achieve supply chain ob,ectives such as A) low cost. =) high responsiveness. %) high cost. D) high responsibility. ") A an = only Answer: " Diff: # Topic: 4.# Factors nfluencing Distribution 0etwor* Design AA%$=: Analytic $*ills &earning 'utco(e: %o(pare co((on approaches to supply chain esign
4) %o(panies in the sa(e inustry often select very ifferent istribution networ*s because A) so(e co(panies are poorly run. =) ifferent co(panies try to avoi using the sa(e approach. %) ifferent co(panies have ifferent ob,ectives for their supply chain. D) all of the above ") none of the above Answer: % Diff: # Topic: 4.# Factors nfluencing Distribution 0etwor* Design ) A poor/inappropriate istribution networ* can A) lea to high profitability. =) hurt the level of service custo(ers receive while increasing cost. %) have a significant negative i(pact on the profitability of a fir(. D) all of the above ") = an % only Answer: D Diff: # Topic: 4.# Factors nfluencing Distribution 0etwor* Design 3) ?hich of the following woul not be the result of a poor/inappropriate istribution networ*@ A) 8igh profitability =) &ow level of custo(er service %) 8igh cost D) 7oor profitability ") 0one of the above are true. Answer: A Diff: 1 Topic: 4.# Factors nfluencing Distribution 0etwor* Design 9) 'n which i(ensions shoul the perfor(ance of a istribution networ* be evaluate at the highest level@ A) 7rofitability of iniviual supply chain co(ponents =) "fficiency of overall supply chain networ* %) %usto(er nees that are (et D) %ost of (eeting custo(er nees ") % an D only Answer: " Diff: Topic: 4.# Factors nfluencing Distribution 0etwor* Design
) ?hich of the following are (easures of custo(er service that are influence by the structure of the istribution networ*@ A) esponse ti(e =) 7rouct variety %) 7rouct availability D) %usto(er eperience ") all of the above Answer: " Diff: 1 Topic: 4.# Factors nfluencing Distribution 0etwor* Design ;) ?hich of the following are (easures of custo(er service that are influence by the structure of the istribution networ*@ A) eturnability =) 'rer visibility %) %usto(er eperience D) 7rouct availability ") all of the above Answer: " Diff: # Topic: 4.# Factors nfluencing Distribution 0etwor* Design 16) ?hich of the following is not a (easure of custo(er service that is influence by the structure of the istribution networ*@ A) eturnability =) %usto(er eperience %) %usto(er (aturity D) 7rouct availability ") All of the above are (easures of custo(er service. Answer: % Diff: 1 Topic: 4.# Factors nfluencing Distribution 0etwor* Design 11) The nu(ber of ifferent proucts/configurations that a custo(er esires fro( the istribution networ* is A) response ti(e. =) prouct variety. %) prouct availability. D) custo(er eperience. ") orer visibility. Answer: = Diff: 1 Topic: 4.# Factors nfluencing Distribution 0etwor* Design
1#) The probability of having a prouct in stoc* when a custo(er orer arrives is A) response ti(e. =) prouct variety. %) prouct availability. D) custo(er eperience. ") orer visibility. Answer: % Diff: 1 Topic: 4.# Factors nfluencing Distribution 0etwor* Design 1-) The ease with which the custo(er can place an receive their orer as well as other aspects of value that the sales staff provies is A) custo(er eperience. =) orer visibility. %) prouct availability. D) response ti(e. ") returnability. Answer: A Diff: 1 Topic: 4.# Factors nfluencing Distribution 0etwor* Design 14) The ability of the custo(er to trac* their orer fro( place(ent to elivery is A) custo(er eperience. =) orer visibility. %) prouct availability. D) response ti(e. ") returnability. Answer: = Diff: 1 Topic: 4.# Factors nfluencing Distribution 0etwor* Design 1) The costs incurre in bringing (aterial into a facility are A) sourcing transportation costs. =) outboun transportation costs. %) crossboun transportation costs. D) inboun transportation costs. ") none of the above Answer: D Diff: 1 Topic: 4.# Factors nfluencing Distribution 0etwor* Design
13) The costs incurre in sening (aterial out of a facility are A) sourcing transportation costs. =) outboun transportation costs. %) crossboun transportation costs. D) inboun transportation costs. ") none of the above Answer: = Diff: 1 Topic: 4.# Factors nfluencing Distribution 0etwor* Design 19) 'utboun transportation costs per unit ten to be A) about the sa(e as inboun costs. =) higher than inboun costs. %) lower than inboun costs. D) neither higher or lower than inboun costs. ") none of the above Answer: = Diff: # Topic: 4.# Factors nfluencing Distribution 0etwor* Design 1) As the nu(ber of facilities in a supply chain increases A) the inventory an resulting inventory costs also increase. =) the inventory an resulting inventory costs ecrease. %) the inventory increases an resulting inventory costs ecrease. D) the inventory ecreases an resulting inventory costs increase. ") the inventory an resulting inventory costs re(ain the sa(e. Answer: A Diff: # Topic: 4.# Factors nfluencing Distribution 0etwor* Design 1;) As the response ti(e esire by the custo(er ecreases+ the re
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#6) As the nu(ber of facilities in a supply chain increases+ total transportation cost A) ecreases. =) re(ains the sa(e. %) increases. D) increases to a point an then ecreases. ") ecreases to a point an then increases. Answer: " Diff: Topic: 4.# Factors nfluencing Distribution 0etwor* Design #1) As the nu(ber of facilities in a supply chain increases+ total facility costs A) ecrease. =) re(ain the sa(e. %) increase. D) increase to a point an then ecrease. ") ecrease to a point an then increase. Answer: % Diff: # Topic: 4.# Factors nfluencing Distribution 0etwor* Design ##) Total logistics costs for a supply chain networ* are a su( of A) inventory an facility costs. =) inventory+ facility+ an istributor costs. %) facility+ transportation+ an istributor costs. D) inventory+ transportation+ an facility costs. ") none of the above Answer: D Diff: # Topic: 4.# Factors nfluencing Distribution 0etwor* Design #-) As the nu(ber of facilities in a supply chain networ* increases+ total logistics costs will A) ecrease. =) ecrease at first an then increase. %) increase. D) increase at first an then ecrease. ") neither increase or ecrease. Answer: = Diff: # Topic: 4.# Factors nfluencing Distribution 0etwor* Design AA%$=: Analytic $*ills &earning 'utco(e: %o(pare co((on approaches to supply chain esign
#4) ?hich of the following are *ey ecisions in the esign of a istribution networ*@ A) ?ill prouct be elivere to the custo(er location or pic*e up fro( a preoraine site@ =) ?ill prouct flow through a prouction facility@ %) ?ill prouct flow through an inter(eiary or inter(eiate location)@ D) all of the above ") A an % only Answer: " Diff: # Topic: 4.- Design 'ptions for a Distribution 0etwor* #) ?hich of the following is not a istinct istribution networ* esign that (ay be use to (ove proucts fro( factory to custo(er@ A) >anufacturer storage with irect shipping =) >anufacturer storage with istributor pic*up %) Distributor storage with pac*age carrier elivery D) Distributor storage with last (ile elivery ") >anufacturer/istributor storage with custo(er pic*up Answer: = Diff: # Topic: 4.- Design 'ptions for a Distribution 0etwor* #3) ?hich of the following is not a istinct istribution networ* esign that (ay be use to (ove proucts fro( factory to custo(er@ A) >anufacturer storage with irect shipping =) >anufacturer storage with irect shipping an intransit (erge %) Distributor storage with pac*age carrier elivery D) Distributor storage with (anufacturer pic*up ") etail storage with custo(er pic*up Answer: D Diff: # Topic: 4.- Design 'ptions for a Distribution 0etwor* #9) n which istribution networ* esign is prouct shippe irectly fro( the (anufacturer to the en custo(er+ bypassing the retailer who ta*es the orer an initiates the elivery reanufacturer storage with irect shipping =) >anufacturer storage with irect shipping an intransit (erge %) Distributor storage with pac*age carrier elivery D) Distributor storage with last (ile elivery ") >anufacturer/istributor storage with custo(er pic*up Answer: A Diff: 1 Topic: 4.- Design 'ptions for a Distribution 0etwor*
#) ?hich istribution networ* is also referre to as ropshipping with prouct elivere irectly fro( the (anufacturer to the custo(er location@ A) >anufacturer storage with irect shipping =) >anufacturer storage with irect shipping an intransit (erge %) Distributor storage with pac*age carrier elivery D) Distributor storage with last (ile elivery ") >anufacturer/istributor storage with custo(er pic*up Answer: A Diff: # Topic: 4.- Design 'ptions for a Distribution 0etwor* #;) ?hich of the following is an avantage of (anufacturer storage with irect shipping@ A) Transportation costs are low because the average outboun istance to the en consu(er is s(all an pac*age carriers are use to shipping the prouct. =) $upply chains save on the fie cost of facilities+ because the nee for other warehousing space in the supply chain has been eli(inate. %) esponse ti(es ten to be s(all because the orer has to be trans(itte fro( the retailer to the (anufacturer. D) 'rer trac*ing is easy to i(ple(ent because of the co(plete integration of infor(ation syste(s at both the retailer an the (anufacturer. ") The hanling of returns is li*ely to be si(ple an inepensive+ i(proving custo(er satisfaction. Answer: = Diff: # Topic: 4.- Design 'ptions for a Distribution 0etwor* -6) ?hich of the following woul be a isavantage of (anufacturer storage with irect shipping@ A) The ability to reuce cost of inventory by centrali2ing inventories at the (anufacturer. =) The (anufacturer has to postpone custo(i2ation until after the custo(er orer has been place. %) $upply chains have to eli(inate other warehousing space to save on the fie cost of facilities. D) esponse ti(es ten to be large because the orer has to be trans(itte fro( the retailer to the (anufacturer an shipping istances are on average longer fro( the (anufacturerBs centrali2e site. ") 7rovies a goo custo(er eperience when a single orer containing proucts fro( several (anufacturers is elivere in partial ship(ents. Answer: D Diff: # Topic: 4.- Design 'ptions for a Distribution 0etwor*
-1) ?hich istribution networ* esign is si(ilar to pure ropshipping+ ecept that pieces of the orer co(ing fro( ifferent locations are co(bine so that the custo(er gets a single elivery@ A) >anufacturer storage with irect shipping =) >anufacturer storage with irect shipping an intransit (erge %) Distributor storage with pac*age carrier elivery D) Distributor storage with (anufacturer pic*up ") etail storage with custo(er pic*up Answer: = Diff: # Topic: 4.- Design 'ptions for a Distribution 0etwor* -#) The (ain avantage of intransit (erge over ropshipping is A) the ability to reuce cost of inventory by centrali2ing inventories at the (anufacturer. =) supply chains save on the fie cost of facilities+ because the nee for other warehousing space in the supply chain has been eli(inate. %) so(ewhat lower transportation cost an i(prove custo(er eperience. D) orer trac*ing is easy to i(ple(ent because of the co(plete integration of infor(ation syste(s at both the retailer an the (anufacturer. ") the hanling of returns is li*ely to be si(ple an inepensive+ i(proving custo(er satisfaction. Answer: % Diff: # Topic: 4.- Design 'ptions for a Distribution 0etwor* --) The (a,or isavantage of intransit (erge co(pare to ropshipping is A) transportation costs are high because the average outboun istance to the en consu(er is large an pac*age carriers are use to shipping the prouct. =) response ti(es ten to be large because the orer has to be trans(itte fro( the retailer to the (anufacturer an shipping istances are on average longer fro( the (anufacturerBs centrali2e site. %) orer trac*ing beco(es harer to i(ple(ent becau se it re
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-4) ?hich istribution networ* esign is being use when inventory is not hel by (anufacturers at the factories+ but is hel by istributors/retailers in inter(eiate warehouses an pac*age carriers are use to transport proucts fro( the inter(eiate location to the final custo(er@ A) >anufacturer storage with irect shipping =) >anufacturer storage with irect shipping an intransit (erge %) Distributor storage with pac*age carrier elivery D) Distributor storage with (anufacturer pic*up ") etail storage with custo(er pic*up Answer: % Diff: 1 Topic: 4.- Design 'ptions for a Distribution 0etwor* AA%$=: Analytic $*ills &earning 'utco(e: %o(pare co((on approaches to supply chain esign -) ?hich of the following is an avantage of istributor storage with carrier elivery@ A) nventory cost is higher than with (anufacturer storage. =) 7rouct variety is lower than with (anufacturer storage. %) 'rer visibility for the custo(er is easier than with (anufacturer storage. D) 8igher cost to provie the sa(e level of prouct availability as (anufacturer storage. ") %ost of facilities an hanling is so(ewhat higher than (anufacturer storage. Answer: % Diff: # Topic: 4.- Design 'ptions for a Distribution 0etwor* -3) ?hich of the following is a isavantage of istributor storage with carrier elivery@ A) nfor(ation infrastructure is si(pler than (anufacturer storage. =) esponse ti(e is faster than with (anufacturer storage. %) eturnability is easier than with (anufacturer storage. D) 7rouct variety is lower than with (anufacturer storage. ") Transportation cost is lower than with (anufacturer storage. Answer: D Diff: # Topic: 4.- Design 'ptions for a Distribution 0etwor* -9) ?hich istribution networ* esign is being use when the istributor/retailer elivers the prouct to the custo(erBs ho(e instea of using a pac*age carrier@ A) >anufacturer storage with irect shipping =) >anufacturer/istributor storage with custo(er pic*up %) Distributor storage with pac*age carrier elivery D) Distributor storage with last (ile elivery ") etail storage with custo(er pic*up Answer: D Diff: # Topic: 4.- Design 'ptions for a Distribution 0etwor* AA%$=: Analytic $*ills &earning 'utco(e: %o(pare co((on approaches to supply chain esign 41%opyright 5 #61- 7earson "ucation+ nc. publishing as 7rentice 8all
-) ?hich of the following is an avantage of istributor storage with last (ile elivery@ A) >ore epensive to provie prouct availability than any other option ecept retail stores. =) nventory cost is higher than istributor storage with pac*age carrier elivery. %) esponse ti(e is very anufacturer storage with irect shipping =) >anufacturer/istributor storage with custo(er pic*up %) Distributor storage with pac*age carrier elivery D) Distributor storage with last (ile elivery ") etail storage with custo(er pic*up Answer: = Diff: # Topic: 4.- Design 'ptions for a Distribution 0etwor* AA%$=: Analytic $*ills &earning 'utco(e: %o(pare co((on approaches to supply chain esign 41) ?hich of the following is an avantage of (anufacturer/istributor storage with custo(er pic*up@ A) Facility costs can be very high if new facilities have to be built. =) Transportation cost is lower than the use of pac*age carriers+ especially if using an eisting elivery networ*. %) 'rer visibility is ifficult but essential. D) 7rouct variety is si(ilar to other (anufacturer or istributor storage options. ") $ignificant invest(ent in infor(ation infrastructure re
4#) ?hich of the following is a isavantage of (anufacturer/istributor storage with custo(er pic*up@ A) %usto(er eperience is lower than other options bec ause of the lac* of ho(e elivery. =) esponse ti(e is si(ilar to pac*age carrier elivery with (anufacturer or istributor storage. %) eturnability is so(ewhat easier given that pic*up location can hanle returns. D) 7rouct availability is si(ilar to other (anufacturer or istributor storage options. ") Facilities costs are lower if eisting facilities are use. Answer: A Diff: Topic: 4.- Design 'ptions for a Distribution 0etwor* 4-) ?hich istribution networ* esign is being use when inventory is store locally at retail stores an custo(ers wal* into the retail store or place an orer online or on the phone an pic* it up at the retail store@ A) >anufacturer storage with irect shipping =) >anufacturer/istributor storage with custo(er pic*up %) Distributor storage with pac*age carrier elivery D) Distributor storage with last (ile elivery ") etail storage with custo(er pic*up Answer: " Diff: 1 Topic: 4.- Design 'ptions for a Distribution 0etwor* 44) ?hich of the following is an avantage of retail storage with custo(er pic*up@ A) nventory cost is higher than all other options. =) Transportation cost is lower than all other options. %) Facilities an hanling costs are higher than other options. D) 7rouct variety is lower than all other op tions. ") 7rouct availability is (ore epensive to provie than all other options. Answer: = Diff: # Topic: 4.- Design 'ptions for a Distribution 0etwor* 4) ?hich of the following is a isavantage of retail storage with custo(er pic*up@ A) eturnability is easier than other options given that pic*up location can hanle returns. =) nventory cost is higher than all other options. %) Transportation cost is lower than all other options. D) Facilities an hanling costs are lower than other options. ") 7rouct variety is higher than all other options. Answer: = Diff: # Topic: 4.- Design 'ptions for a Distribution 0etwor*
43) Distributors a value to a supply chain between a supply stage an a custo(er stage A) if there is a s(all nu(ber of custo(ers re
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4;) CCCCCCCC is a cost factor perfor(ance characteristic of etail $torage at %onsu(er 7ic*up $ites that is higher than all other options. A) Transportation =) nventory %) nfor(ation D) Facilities an 8anling Answer: = Diff: Topic: 4.- Design 'ptions for a Distribution 0etwor* &earning 'utco(e: %o(pare co((on approaches to supply chain esign 6) CCCCCCCC is a service factor perfor(ance characteristic of etail $torage at %onsu(er 7ic*up $ites that is lower than all other options. A) esponse ti(e =) 7rouct variety %) 7rouct availability D) Ti(e to (ar*et Answer: = Diff: Topic: 4.- Design 'ptions for a Distribution 0etwor* &earning 'utco(e: %o(pare co((on approaches to supply chain esign 1) CCCCCCCC is a service factor perfor(ance characteristic of >anufacturer or Distributor $torage with %usto(er 7ic*up that is lower than other options because of the lac* of ho(e elivery. "perience is very sensitive to capability of pic*up location. A) esponse ti(e =) 7rouct variety %) %usto(er eperience D) Ti(e to (ar*et Answer: % Diff: 1 Topic: 4.- Design 'ptions for a Distribution 0etwor* &earning 'utco(e: %o(pare co((on approaches to supply chain esign #) CCCCCCCC is a cost factor perfor(ance characteristic of >anufacturer or Distributor $torage with %usto(er 7ic*up that is lower than the use of pac*age carriers+ especially if using an eisting elivery networ*. A) Transportation =) nventory %) nfor(ation D) Facilities an 8anling Answer: A Diff: 1 Topic: 4.- Design 'ptions for a Distribution 0etwor* &earning 'utco(e: %o(pare co((on approaches to supply chain esign
-) CCCCCCCC is the a(ount of ti(e it ta*es for a custo(er to receive an orer. A) Ti(e to (ar*et =) 7rouct Availability %) eturnability D) esponse Ti(e Answer: D Diff: 1 Topic: 4.# Factors nfluencing Distribution 0etwor* Design &earning 'utco(e: %o(pare co((on approaches to supply chain esign 4) %hanging the istribution networ* esign D'"$ 0'T affect the following supply chain costs A) transportation. =) inventories. %) infor(ation. D) sourcing. Answer: D Diff: # Topic: 4.# Factors nfluencing Distribution 0etwor* Design AA%$=: Analytic $*ills &earning 'utco(e: %o(pare co((on approaches to supply chain esign ) Facility costs ecrease as the nu(ber of facilities is reuce. ?hich co(pany e(ploys a networ* esign li*e this@ A) =arnes an 0oble =) =oo*sA>illion %) $tarbuc*s D) A(a2on Answer: D Diff: # Topic: 4.# Factors nfluencing Distribution 0etwor* Design AA%$=: eflective Thin*ing $*ills &earning 'utco(e: %o(pare co((on approaches to supply chain esign 3) ?hich is NO consiere a pri(ary part of Total &ogistics %osts for a supply chain networ*@ A) nventory =) >anufacturing %) Transportation D) Facility cost Answer: D Diff: # Topic: 4.# Factors nfluencing Distribution 0etwor* Design &earning 'utco(e: %o(pare co((on approaches to supply chain esign
4.- "ssay Questions 1) "plain the (easures of custo(er service that are influence by the structure of the istribution networ*. Answer: esponse ti(e is the ti(e between when a custo(er places an orer an receives elivery. 7rouct variety is the nu(ber of ifferent proucts/configurations that a custo(er esires fro( the istribution networ*. Availability is the probability of having a prou ct in stoc* when a custo(er orer arrives. %usto(er eperience inclues the ease with which the custo(er can place an receive their orer. t also inclues purely eperiential aspects+ such as the possibility of getting a cup of coffee an the value that the sales staff provies. 'rer visibility is the ability of the custo(er to trac* their orer fro( place(ent to elivery. eturnability is the ease with which a custo(er can return unsatisfactory (erchanise an the ability of the networ* to hanle such returns. Diff: # Topic: 4.# Factors nfluencing Distribution 0etwor* Design #) "plain how the esign of the istribution networ* affects the cost of the four supply chain rivers. Answer: As the nu(ber of facilities in a supply chain increases+ the inventory an resulting inventory costs also increase. To ecrease inventory costs+ fir(s try to consoliate an li(it the nu(ber of facilities in their supply chain networ*. 'utboun transportation costs per unit ten to be higher than inboun costs because inboun lot si2es are typically larger. ncreasing the nu(ber of warehouse locations ecreases the average outboun istance to a custo(er an (a*es outboun transportation istance a s(aller fraction of total istance travele by the prouct. Thus+ as long as inboun transportation econo(ies of scale are (aintaine+ increasing the nu(ber of facilities ecreases total transportation cost. Facility costs ecrease as the nu(ber of facilities is reuce+ because a consoliation of facilities allows a fir( to eploit econo(ies of scale. As the nu(ber of facilities increases+ total logistics costs first ecrease an then increase. "ach fir( shoul h ave at least the nu(ber of facilities that (ini(i2e total logistics costs. As a fir( wants to further reuce the response ti(e to its custo(ers+ it (ay have to increase the nu(ber of facilities beyon the point that (ini(i2es logistics costs. A fir( shoul a facilities beyon the cost(ini(i2ing point only if (anagers are confient that the increase in revenues because of better responsiveness is greater than the increase in costs because of the aitional facilities. n general+ no istribution networ* will outperfor( others along all i(ensions. Thus+ it is i(portant to ensure that the strengths of the istribution networ* fit with the strategic position of the fir(. Diff: Topic: 4.# Factors nfluencing Distribution 0etwor* Design
-) "plain the si istinct istribution networ* esigns that (ay be use to (ove proucts fro( factory to custo(er. Answer: n (anufacturer storage with irect shipping+ prouct is shippe irectly fro( the (anufacturer to the en custo(er+ bypassing the retailer who ta*es the orer an initiates the elivery reanufacturer storage with irect shipping an intransit (erge is si(ilar to pure ropshipping+ ecept that pieces of the orer co(ing fro( ifferent locations are co(bine so that the custo(er gets a single elivery. Distributor storage with pac*age carrier elivery is being use when inventory is not hel by (anufacturers at the factories+ but is hel by istributors/retailers in inter(eiate warehouses+ an pac*age carriers are use to transport proucts fro( the inter(eiate location to the final custo(er. Distributor storage with last (ile elivery is being use when the istributor/retailer elivers the prouct to the custo(erBs ho(e instea of using a pac*age carrier. >anufacturer/istributor storage with custo(er pic*up is being use when inventory is store at the (anufacturer or istributor warehouse but custo(ers place their orers online or on the phone an then co(e to esignate pic*up points to collect their orers. etail storage with custo(er pic*up is being use when inventory is store locally at retail stores an custo(ers wal* into the retail store or place a n orer online or on the phone an pic* it up at the retail store. Diff: # Topic: 4.- Design 'ptions for a Distribution 0etwor*
4) "plain how istributors a value to a supply chain an i(prove its perfor(ance. Answer: Distributors a value to a supply chain between a supply stage an a custo(er stage if there are (any s(all players at the custo(er stage+ each re
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