Question: indicate both generally and specifically how logistics decisions can impact a firm's return on net worth (RONW). Assume that you are the CEO of a
indicate both generally and specifically how logistics decisions can impact a firm's return on net worth (RONW). Assume that you are the CEO of a small-size automobile parts manufacturing firm (less than $20 million sales per year) located in Tampa, Florida. Your firm specializes in producing engine, transmission, body, and other parts needed to repair or service most automobiles sold prior to the year 2000. Your products are viewed by customers as being of good quality and are moderately priced. Most of your customers are automobile dealerships, repair shops, independent garages and individual consumers who own older cars. The industry has few competitors, with most being smaller local and regional firms. Price wars between competitors never occur. Presently, your company is leading the industry in terms of sales volume, net profit margin, asset turnover, and return on net worth. However, your firm is highly leveraged (you have large short-term and long-term debt), so you do not have the ability to borrow additional funds for the foreseeable future. Your firm utilizes personal computers for office tasks such as invoicing and business correspondence and utilizes manual systems for all other functions. Almost 90% of all shipments to customers are made using motor transport. Some shipments to non-retail customers are sent by USPS, FedEx, and UPS. Discuss one (1) specific strategy or tactic in each of the following four logistics areas that could be developed and/or implemented that would improve or maintain the firm's position within the industry: (a) inventory management, (b) warehousing, (c) customer service, and (d) transportation. Include both cost and service trade-offs and the financial implications of each strategy or tactic proposed. Your strategies should be specific and not too general. Your strategies should be linked to the specifics of the question and any assumptions that you make.
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