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Case 3

• Type of Company: food products.

• Type of Clients served by the CD: Supermarkets, Wholesalers, Large Distributors
cities and only a smaller percentage of exports in containers or trucks.
• The production plant and the DC are boundaries.
• It has 11 production lines that allow packaging in different brands and
presentations. The pallets arrive complete on a standardized pallet. Due to recent quality problems,
they analyze each pallet produced, which requires control and traceability for each pallet.
Everything produced on the day is considered to be the same batch. 300 pallets enter daily. The
plant works 6 days a week.
• Quantity and Type of SKUs: there are 250 SKUs considering the different types of products, brands
and packaging. The minimum unit of movement is the package, boxes are not opened. The
distribution of sales follows the proportions of Pareto's law. The expiration of the products is 9
months. The weight of the pallets is a maximum of 1000kg and does not exceed 1.70m in height
with pallet included.
• Inventory levels in the CD: it is kept in stock for 15 days of average sales.
• CD Characteristics: currently it has a CD of 5,000m2 (50m x 100m) and 10m of
free height, where all logistical operations are carried out.
o It has a 20m deep staging out across the entire width of the CD.
o For storage, it has single-depth selective shelving, with a total capacity of 5,100 positions on
5 levels. (there are 7 double batteries and two single batteries on the sides of the ship)

o It has a picking sector distributed in two aisles with a capacity of 180 positions per floor (it
only serves the internal market). The preparation of orders has a proportion of 65%
to full pallets and the rest to picking pallets in the domestic market and 90% to full pallets
in exports.
o Operates with Reach Stackers with a lifting capacity of 1000kg at 8.50m.
o The CD meets current storage and preparation needs
orders, without overflowing into external operators.

The company plans to strongly increase its sales in the foreign market, which would generate a 40%
increase in stock compared to the current situation.

Given the limited availability of space that the company has on the property, they ask you as Logistics
Manager to analyze how much you can increase the capacity of the DC without expanding the surface and
maintaining quality and service standards.

• It is requested to develop / suggest at a conceptual level:

o General description of what modifications you would make.
o Mobile and storage equipment chosen
o Capacity reached.
o IT support, associated equipment
o Weigh and compare the proposals considering investment, operation, and achieved
capacity.