In this assessment, we will work on a company called MaveriCo, which has been operating
across different cities around the world. The management team is planning to expand
to the Kingdom of Square, a new market they recently identified. MaveriCo relied on a
key component provider, Kii Supplies, for its production. In order to expand to the new
market, MaveriCo has negotiated with Kii Supplies to set up a warehouse in the Kingdom
of Square. MaveriCo also decides to set up assembly facilities in the Kingdom of Square
to quickly respond to customers.
You were assigned for this project as the supply chain manager of MaveriCo! You will need
to design a proper supply network to support MaveriCo’s operations in the Kingdom of
Square.
2 Data Collection
To start with the project, you requested some data from MaveriCo. MaveriCo believes
that the demand might be related to a city’s population, or relates to the number of years
it stayed in the city, or both. Based on this assumption, they provided some data shown
in Table 1 for the demand information across a number of cities.
Apparently, you want to check whether MaveriCo’s assumption is correct and use your
findings to figure out the potential demands for the cities in the Kingdom of Square.
Table 2 presents the name, population, and the coordinates for each city. The distance
between any two cities can be assumed to be the Euclidean distance with a circuity factor
kCF of 1.30.
Your also checked with Kii Supplies about its preferred location for the warehouse. Kii
Supplies agreed to set up its warehouse based on the last digit of your student number as
shown in Table 2. For example, if the last digit of your student number is ‘5’, Kii Supplies
will set up its warehouse in Edofield. Kii Supplies also recommended a transport company
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City Population (millon) Years in City Current Annual Demand
Brisbane 2.3 3 275,000
Chengdu 9.0 5 553,000
Guangzhou 13.1 4 680,000
Hobart 0.2 7 375,000
Melbourne 4.4 7 689,000
Moscow 13.2 5 775,000
Perth 2.0 3 212,000
Shanghai 24.1 5 993,000
Sydney 4.6 7 503,000
Tokyo 13.5 5 715,000
Table 1: Demand information across a number of cities.
that could manage the inbound and outbound logistics for you. The quoted transport price
is $0.005/component/unit distance traveled for inbound logistics (i.e., from Kii Supplies to
your assembly facilities), and $0.01/product/unit distance traveled for outbound logistics
(i.e., from your assembly facilities to the cities).
City Population (in ‘000) Coordinates (X,Y) Last digit of sNumber
Aresgas 1,060 (501, 695) 1
Brey 1,446 (377, 321) 2
Craford 1,320 (260, 382) 3
Drego 539 (974, 436) 4
Edofield 1,993 (648, 898) 5
Frila 867 (387, 248) 6
Gona 1,330 (236, 244) 7
Huling 1,070 (196, 852) 8
Indale 645 (421, 513) 9
Jemore 1,712 (263, 982) 0
Table 2: Population and coordinates for each city.
To set up an assembly facility, it will cost you $100,000 per facility. You will need to take
this into consideration when you choose your assembly sites and design your distribution
network. To facilitate your work, you were advised to focus on the first year for the
operations in the Kingdom of Square. Each component received from Kii Supplies will be
assembled into one finished product.
3 The Task
You believe by now you have got all the required data and you are ready to start. Your
task will need you to use the knowledge acquired in this course, explain the rationale
behind your chosen approaches, document your analysis, and present your results to the
management team of MaveriCo.
The following list offers some ideas for you to think further (remember this is not an
exhaustive list):
• What will the demand look like for each city for the year to come?
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• What determines the fixed cost for the assembly facilities?
• Use your sNumber to find the warehouse for Kii Supplies. What will determine how
many units you transport to each assembly facility?
• In which cities should you set up the assembly facilities?
• Which cities should be served by which assembly facility?
• Build different scenarios (in terms of number of assembly facilities) and discuss the
tradeoffs to be considered. For example, what will be the maximum distance you need
to travel from an assembly facility to a city? Based on these tradeoffs, recommend
your final network design structure.
You should build models for this project in an Excel spreadsheet, which will need to be
submitted as part of this assessment item. With proper model building, you can complete
this project in a stage-wise manner.
Please round demand information to the nearest integer (consider using the ROUND function
in Excel), and keep two decimal points for the distances and currencies.
4 Suggested Structure for Report
The report, which should be around 2,500 words (+/- 10%), should clearly discuss the
findings based on the modeling of the supply chain to be designed. The following is a
suggested structure for the report for 7108IBA, with approximate suggested word count
for each section. Remember this is not a definitive structure for the course, but just a
suggestion.
• Introduction/Background. (200 to 400 words). Covers the background of the
project at hand and builds towards explaining the relevance and context of the project
to be solved.
• Approach and Rationale. (400 to 600 words). A brief coverage of how you intend
to solve the project and why you choose these approaches (within the course content)
to solve it.
• Presentation and Analysis of Results. (600 to 1,000 words). This is the place
to present your results and analyze what these results are telling you from a supply
chain perspective. You may want to effectively use tables and figures (and other
means) in this part. If you do so, do not forget to explain the tables/figures/etc in
the text.
• Discussion. (500 to 700 words). This is where you discuss what you have found and
relate it back to supply chain modeling in general. For example, what could possibly
be the case if the parameters are changed slightly (e.g., due to inaccurate estimation
of assembly site fixed cost)? What challenges would you envisage for supply chain
modeling tasks like this project?
• Conclusions. (200 to 400 words). What conclusions can you draw from what you
have found out, both from the project and from the techniques used to solve the
project?