A B 1 2 C D E F G H Trade-off analysis between transportation cost and responsiveness J K L M N 3 4 Roadrunner Steel (RS) is a steel service center in the Bakersfield area. All orders are shipped to customers using an LTL carrier that charges $100+ 0.01p where p is the number of pounds of steel shipped on the truck. Currently, RS ships orders 5 6 on the day they are received. Allowing for two days in transit, this policy allows RS to achieve a response time of two days. Daily demand in pounds at RS over a two-week period is shown in below table: 7 8 9 10 Column] Week 1 Week 2 Mon Tue - Wed Thu -Fri Sat Sun - 19,970 39,171 17,470 11,316 2,158 20,633 26,192 20,263 23,370 24,100 8,381 19,603 25,377 18,442 11 12 13 The manager at RS believes that customers do not really value the two-day response time and would be satisfied with a four-day response. She knows, as the response time increases, RS has the opportunity to aggregate demand 14 15 16 17 18 over multiple days for shipping. For response time of three days, RS can aggregate over two successive days before shipping. For response time of four days, RS can aggregate over three successive days before shipping. The manager evaluates the quantity shipped and transportation costs for different response time over the two-week period in below table: Complete the shaded cells of the table below and give answers to questions. What are the cost saving as the response time increases from two to three days? Answer: 19 23 24 25 26 2222222 20 21 What are the further cost saving as the response time increases from three to four days? Answer: If you are the manager, would you choose three- or four-day response taking both cost saving and response time? Answer: Two-day response Quantity Three-day response Four-day response Quantity Quantity 27 Day Demand Shipped Cost($) Shipped Cost($) Shipped Cost($) 28 1 19,970 19,970 300 29 2 17,470 17,470 275 37,440 474 30 3 31 4 32 5 33 6 34 7 35 8 36 9 37 10 38 11 39 12 40 13 41 14 42 13