Super Dolls is a toy manufacturing company which is in the business for the past two decades. The manufacturing unit is situated in Mumbai, while its sales and marketing are spread over a large geographical area, especially in the major cities across the country. Over the years, a number of competitors have sprung in the field. Far from child\u2019s play, the company found that the toys\u2019 sector is a tough business. Some of the problems faced by it are:
\u00d8There are high marketing and promotional costs. If these programmes go out, the sales drop massively
\u00d8Anymisjudge of the market can also mean closing down of the company
\u00d8The company has problems regarding stock holding at its distribution centers. This is mainly due to wrong inputs
The management of Yummy Noodles Company was contemplating on introducing 200 grams pack of savory noodles into the Indian market at Rs. 10 per pack. This was only for one month which was construed to be as a test marketing period. During this period, the Company wanted to have a \u201cblitz\u201d strategy of flooding the market with their product.
In the subsequent month, the management of Yummy Noodles Company had planned to raise the price of the pack to Rs. 15, while the weight of the pack was to be fixed at 250 grams. A free gift in the form of a plastic bowl with a spoon was also planned.
Two monthsbefore the launch of the actual production, the marketing department of the company brought out advertisements regarding the savory noodles. The advertisements were displayed on bill-boards, TV, radio, print media. Schools and colleges were also targeted to rope in students and children to buy the product.
Production of the noodles was planned to be started along with the marketing program. The forecast of the number of expected packets that could be sold for the first month was around 75,000, and 1,25,000 for the second month. The production was required to be startedearlier to meet the target of projected demand as well as to account for the changeover in the pack-size in the second month.
Food Savories Limited is engaged in the manufacturing of various types of fast food items that are ready-to-eat variety. It has been in the business for the past 12 years. It has its factory as well as the processing unit in Navi Mumbai. The raw materials required are mainly vegetables, chicken which the company procures from either the local vendors, or from various suppliers situated at Nasik, Pune and other districts. The required materials are procured with the help of hired transporters. However, the hired transporters do not care much about the preservation of the goods. Hence, about 20% of the goods are lost due to damage, deterioration, pilferage, etc. Again, the hired transporters are unreliable with regard to their availability as well as prompt delivery schedules.
The company\u2019s products are quite popular with the customers who are situated in Mumbai, Navi Mumbai, Pune, etc. However, the company stands tolose the market due to erratic supply schedules which do not caterpromptly to the customers. The packaging of the products is attractive, but itdoes not preserve the product for a long time. The shelf-life is only about 5 hours, if the goods are not properly refrigerated. Loss on this account is about 10%.
The company has about 10 distribution centres. But there does not seem to be the muchcoordination between these centres. Logistical information system isnot adequate. Due to this, the company is unable toexpand its business. In fact, due to competition, there is fear that the company may stand to lose its existing clientele. Due to mismanagement, the company is unable to meet increase in the demands during festival seasons and holidays.
having own fleet of specialized trucks and related variable costs versus hiring specialized fleet of trucks. In case of hired trucks, agreement should be made with regard to compensation to be paid by the transport company in case goods are damaged/pilfered by them]
edge\u201d. Improvement in the company\u2019s performance vis-\u00e0-vis performance in inbound logistics, processing, packaging, storage/warehousing, marketing/sales programmes. Quality and taste of the product may be altered to suit various sections of customers. Different sizes of packets to suit customers\u2019 budget]
Shoppers\u2019 Paradise has a swanky mall at Andheri, Mumbai. They have a complete range ofwho\u2019s who of shopping items. It was shop-in-shop based on international standards. The shop area is nearly 3, 50,000 square feet and about 25,000 customers visit the mall daily.
Shoppers\u2019 Paradise basically targets higher income groups. Therefore, it prefers to use roadways for transport of goods from the vendors. Though expensive as compared to railways, roadways have advantages in terms of door-to-door delivery, quicker decisions regarding change in routes or change in delivery schedules, etc.
Since noheavy inventory has to be transported, mechanized material handling is not used since it would involve heavy capital investment. Pallets and crates are used extensively. Again, when goods are returned by the customers due to defects, Shoppers\u2019 Paradise sends the goods to the warehouse from where the goods are sent back to the concerned vendor. The cost of return is borne by the vendors.
Shoppers\u2019 Paradise is very keen to ensure that the customers get the right product at the right time. At the same time, the management of Shoppers\u2019 Paradise desires to reduce the overall cost. You are appointed as a Logistics Consultant. Suggest ways to improve the performance of Shoppers\u2019 Paradise.
M/s BPL has embarked on a policy of satisfying every possible customer in respect of shades, delivery and durability.
Thus, it went ahead and created twenty-five depots, one in almost every city. The manufacturing base was, however,
maintained in Pune. The factory received information in connection with stocks from depots once a week and there was no
intercommunication between the depots. Since they were in the competitive market, price was pre-determined, i.e., the
manufacturer had no liberty to price the product as per his own choice.
In their enthusiasm and effort to satisfy their customers, M/s BPL strived to manufacture every possible shade by
combining various primary shades and would await the prospective customer to carry out the purchase. It ensured that these
shades were available at each and every depot even at the cost of transportation incurred in sending goods in less than full
truck load lots. This certainly provided a very high service level and the customers would get their shades as per their
desires and thus they were fully satisfied.
Industrial paints, though not very customized, the respective industrial customer was quite satisfied. Consequently, the inventory of finished goods was very low in this segment. But, at the same time, realization was also lower due to stiff competition from other industrial paint manufacturers than the domestic market.
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