PLEASE DO NOT COPY AND PASTE FROM ANOTHER ANSWER, SPECIALLY THE DIAGRAM, THIS DOES NOT HELP ME. I'D APPRECIATE IF ITS ONLY ORIGINAL WORK

National Appliance, Inc.

Bob Reard, Director of corporate transportation for National Appliance, Inc., has just hung up the phone after a lengthy discussion with Susan Jameson, vice president of logistics. National Appliance has just acquired an appliance distributor located in Paris, and the logistics department has two months to develop an operating process to support this European distributor with National Appliance products. The shipments to Paris will begin in approximately five months, and Mr. Reard is to prepare a transportation operating plan for these shipments.

National Appliance is a medium-size U.S. manufacturer of refrigerators and electric ranges. During the past fifteen years, National Appliance has increased its share of the refrigerator and electric range market from less than 2 percent to 20 percent. Part of the reason for this tremendous growth is that National Appliance offers high-quality products at low prices. In addition, National Appliance has vertically integrated both its supply and marketing channels. National believes that quality products result from actually owning and managing key component vendors and that quality marketing and sales efforts result from directly managing distributors and retail appliance outlets.

It surprised Mr. Reard to learn that National Appliance had purchased control of a European alliance distributor. There had been many rumors about expansion into the European market, but Mr. Reard had felt that National Appliance would merely develop a contractual relationship with a distributor in Europe, not purchase a distributor.

Purchasing the Paris distributor is the first major international business venture for National Appliance in its thirty-five-year history. During the late 1990's the company had unsuccessfully attempted to market refrigerators in both Canada and Mexico. Mr. Reard had personally managed the truck shipments to both countries. Consequently Mr. Reard and his staff have very limited international experience. They do, however, possess considerable expertise in domestic transportation, having successfully controlled both transportation costs and services during the company's rapid growth in the past fifteen years.

Given the emphasis on quality products and service, top management has mandated consistent, low lead times. National Appliance delivers domestic distributor orders in less than five days from the order date; the company allows no exceptions to this service policy. Truck transportation, including a private fleet, is the primary mode the company uses for both inbound and outbound shipments. Spare parts are normally shipped by ground express, but the company uses air express when the distributor or dealer needs a special part immediately. Ms. Jameson has established a logistics quality control program that measures carrier performance and has used Mr. Reard's managerial skills to assure acceptable performance from National Appliance carriers.

Having had little experience in international transportation, Mr. Reard feels a bit out of his element in developing an international transporation plan. Ms. Jameson has assured him that transportation is transportation and that the only difference between international and domestic transportation is distance.

Distance is going to be a major factor, since National Appliance has plants located in Memphis, Minneapolis, and Omaha. This long distance from the European market will contribute to two basic problems; high transport costs and long lead times. Moving the products from the plants to the Atlantic or Gulf ports will require some form of ground transporation. Ocean carrier shipment will be long, and Mr. Reard will have to arrange to move the product from the French entry port to Paris. Mr. Reard is sure that he can hire an international transportation manager, but he will have to pay a high salary.

With the logistics planning meeting set for the next morning at 8:00 a.m., Mr. Reard prepares the following transporation plan for Ms. Jameson:

1. Finished product from all three plants will be shipped by truck to NY/New Jersey ports.
2. Water transportation will be used from New York/NJ to LeHavre, France.
3. Trucks will transport the products from LeHavre to the Paris distributor.
4. From Paris, the distributor will arrange transportation to the ultimate customer.
5. An international transportation manager will be hired.

Mr. Reard estimates that the total transit time required for this move will be approximately four weeks.

Case Questions:

a) What is the initial problem?

b) Type up the answer to these two questions, using supporting materials from text, class, news, research citations, etc.

1. Assess the strengths and weaknesses of Mr. Reard's international transporation plan.
2. Develop an alternative international plan to present to Ms. Jameson, and provide justification sufficient to support its adoption. (include the strengths and weaknesses of your plan)

c) You must include one visual diagram, and include one justification for your strategy (strength or weakness).