Suppose that the company is willing to consider dropping the distribution center limitations; that is, customers could
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Question:
Suppose that the company is willing to consider dropping the distribution center limitations; that is, customers could be served by any of the distribution centers for which costs are available. Currently, the shipping from Ft. Worth to Salt Lake City, Phoenix, Los Angeles and San Diego can be outsourced to UPS at a flat rate of $3.5 per unit, regardless of destination. In addition, the shipping from Las Vegas to Dallas, San Antonio, Wichita, and Kansas City can be outsourced to Fedex at a flat rate of $4.0 per unit. Can costs be reduced? If so, by how much?
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