Bis Electronics is a company that create and deliver solutions for data storage. Their main manufacturing facility is in the west coast of Puerto Rico. Recently the company has acquired 3 more companies to add more diversity to their product portfolio. The 3 new products from the acquisition are on new product introduction phase (NPI). In this phase the Supply Chain, Material Engineering (ME), Product Engineering and Manufacturing Engineering Department are analyzing the impact on current production schedules with the addition of 3 more products.

The ME department has identified 120 new materials and 60 existing materials in the new products. For the new material, a Request for Quote has been sent to all partner distributors and direct manufacturers.

There is a tariff of 25% of component price for each component that is manufactured in China.

The commodity manager (CM) has already identified the best potential supplier using as criteria: business relations with suppliers, unit price and minimum order quantity. There is one criterion that needs to be added to the analysis: the inbound cost. Using the data provided for component prices, restrictions, fees, shipment and packaging method, carriers and cost per pound we want to determine for each component, who to buy it from, the quantity what shipment and packing method to use, the carrier, lead time and total price.

Hints:

• Do a deep analysis for the top components based on spending and leverage to other components.
• Calculate Extended EMU and Spending (table 2)
• Compare between regions, suppliers, carrier, method (pallets vs single unit), cost, etc.
• Ocean shipments options have a 35% increase in LT and 25% decrease on CPP from regions (specified in table 3)
• Ocean shipments have a minimum of 2 pallets needed

Table 1: List of carriers with cost per pound (CPP)

Carrier	Ship from Region
	AMS	APAC	EMEA
DHL	$ 1.67	$ 2.80	$ 3.50
FedEx	$ 1.50	$ 6.04	$ 6.25
UPS Brown	$ 1.40	$ 3.10	$ 2.30

Table 2: List of new components

Material	Qty per	Price	Extended EMU	Spending
10011	1	$32.00
10014	1	$22.00
10018	3	$5.00
10017	1	$13.00
10008	2	$1.50
10015	1	$2.50
10004	2	$1.20
10010	1	$2.24
10009	2	$1.10
10006	2	$0.43
10007	2	$0.41
10020	1	$0.75

*EMU- Estimated monthly use. Product EMU is 2000

Answer rating: 100% (QA)

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