Logistics Strategy

A logistics manager is asked to perform a total cost analysis for the organization. Which of the following trade-offs is critical to consider?

• Inventory carrying costs vs. production costs.

• Distribution costs vs. order processing costs.

• Transportation costs vs. inventory carrying costs.

• landed costs vs. production costs.

To achieve a reliable logistics system, the following factors should be fulfilled, except:

• A sufficient storage infrastructure

• Appropriate tools for material handling

• The fastest transportation mode

• Support for information technology

The logistics planning triangle highlights the importance of managing the following strategies:

• Transportation, Inventory, Purchasing

• Production Scheduling, Procurement, Storage

• Storage, Factory location, Service Level

• Facility/Location, Inventory, Transportation

The followings are the concepts commonly used for logistics strategy formulation, except:

• Consolidating shipments into smaller shipment

• Delaying formation of the final product as long as possible

• Providing the same service level for all products

• Avoid product variety as much as possible.

In an effort to increase their customer service levels and reduce order cycle time, a company is considering adding two additional warehouses to their overall operations. As a result, which of the following statements best reflects the cost impact of the additional warehouses?

• Lower inventory costs and higher facility costs

• Higher inventory costs and lower facility costs

• Higher inventory costs and higher inbound transportation costs

• Lower inventory costs and lower inbound transportation costs

In lean logistics strategy, the objective is to achieve the efficient operations by considering constraint of customer service.

• True

• False

In developing a logistics strategy, we must always consider the cost conflict that might appear from the implementation. For example, increasing stock points will result in...

• Higher inventory cost and lower transportation cost

• Higher inventory cost and higher transportation cost

• Lower inventory cost and lower transportation cost

• Lower inventory cost and higher transportation cost

In responsive strategy, commonly company will maintain lower level of inventory and focus on turnover rate control.

• True

• False

Distribution network design that focuses on centralized inventory which leads to high product availability and low level of inventory is called:

• Manufacturer storage with direct shipment and in-transit merge

• Distributor storage with carrier delivery

• Manufacturer storage with direct shipment

• Distributor storage with last mile delivery

Distribution network design that uses package carrier delivery to transport products from intermediate location to the final customer is called:

• Manufacturer storage with direct shipment and in-transit merge

• Distributor storage with carrier delivery

• Manufacturer storage with direct shipment

• Distributor storage with last mile delivery