Case problem 6.3 in chapter 6 has nothing to do with the question here.

DMI Chemicals Inc. Ahmad Khouri works as a logistics coordinator for DMI Chemicals Inc., a company first introduced in Case Problem 6.3 in Chapter 6. DMI imports chemicals and additives used in paint and resin manufacturing and sells them to customers throughout North America. Faced with growing demand for DMI's products and a warehouse operating near capacity, Ahmad is preparing recommendations on how to manage larger volumes while controlling supply chain costs. Before coming to Canada and joining DMI Ahmad worked for an established petrochemical distribution company in Dubai Drawing on his experience in petrochemical distribution, Ahmad has identified two issues with DMI's current distribution model: DMI's customers are spread out over several regions in North America. The regions account for the following portions of DMI's sales: 24% by volume is sold in Texas, 20% in Mexico, 16% in Ontario, 13% in Alberta, 9% in Michigan, 8% in California, and the last 10% in the Eastern United States. Currently the company operates a single warehouse in southern Ontario. It takes a few days to deliver orders to customers in the southern U.S. and Mexico, and some customers have said they would place more orders with DMI if the delivery charges weren't so high. At the moment. DMI has to charge high delivery fees to cover the high cost of insurance for its highly flammable products. Insurance costs for these deliveries depend partly on the length of the trip. Most of DMI's products come in a variety of grades (up to six per product) that is determined by the purity of the product. DMI currently doesn't do any refining, and instead imports and stores each grade of product separately. DMI's suppliers ship the product by sea freight and have large minimum order quantities. As a result, DMI is forced to order and stock large quantities of each grade of product. Ahmad knows that the chemical process to purify some of DMI's main products is simple and inexpensive, and wonders whether there are better ways to stock and manage the different grades of products it distributes. Help Ahmad prepare a report for DMI's CEO with a couple recommendations on how to handle larger volumes of product and keep supply chain costs low