Business Case Assignment Topic – Eco BottleThe Company: Eco BottleYou have just been hired as the Director of Logistics for Eco Bottle (EB). In your newrole, you will have responsibility for general logistical planning including functions suchas inbound and outbound freight and any logistics-related functions within EB.EB is a ten year old Canadian manufacturer of premium refillable water bottles. EB islocated in Winnipeg Manitoba where their manufacturing facility, warehouse, andadministrative offices are contained within a single building. EB employs seventy staffmembers, 35 of them dedicated to manufacturing, 15 to warehouse operations, and theremaining 25 in various administrative positions.EB has positioned their product in the ‘premium’ category and is enjoying year over yeargrowth. Their primary product is a 750 ml refillable water bottle that is manufacturedusing two primary raw materials: stainless steel for the body of the bottle and highdensity plastic for the removable lid. EB has spent considerable effort on research anddevelopment and the bottle is considered to be industry leading in its ability to maintainboth hot and cold temperatures.75% of EB’s sales are done through an online distributor called Skyway who maintainsdistribution centres in Calgary AB, Mississauga ON, and Montreal QC. Skywayspecializes in selling athletic and outdoor goods direct to Canadian consumers and usessmall package providers and couriers to provide a one or two-day delivery to mostCanadian households. EB currently ships product over the road to Skyway’s distributioncentres and if ordered in TL quantity, EB pays for the freight expense. When LTLquantities are ordered, EB charges the freight expense to Skyway. The remaining 25% ofsales are done through a small group of boutique specialty stores across Canada thathave requested the product specifically to stock. These sales are normally low volumeand shipped via a small package or courier service to the boutique specialty store.
Business Case Assignment Part one
EB purchases its high density plastic from a distributor in Shenzhen China. Thisspecialty plastic is transported by a conference ocean carrier as LCL through the port ofVancouver BC where it is then destuffed and transported by intermodal rail to EB inWinnipeg MB. The plastic is purchased in a small pellet form and packed in doublewalled corrugate gaylord cartons measuring 48 inches x 40 inches wide and 36 inchestall. Each carton is lined with a plastic bag and then capped with a corrugate lid. Whenfilled, each gaylord carton weighs 1,500 lbs. For both the ocean and rail portions oftransportation, nothing occupies the space above the gaylord boxes in the containers asthey are not capable of being stacked.
A potential new supplier of plastic has been found in Halifax Nova Scotia. Thismanufacturer produces a comparable product to the Shenzhen supplier. The newsupplier in Halifax would transport the plastic pellets in a bulk hopper car via rail to atransloading facility in Winnipeg Manitoba. A packaging facility operates adjacent to therail terminal in Winnipeg where the plastic would then be packaged in the samegaylord cartons currently being used for delivery over the road to EB only a fewkilometers away. You have not been given costing information yet but have been askedto prepare a preliminary report that would highlight the logistical differences betweenthe two options. Compare and contrast the two modes of transportation and whatimpacts this would have on EB.
Specifically, you have been asked to:1. Compare and contrast the two modes of transportation and what impacts thiswould have on EB.2. Discuss the organizational changes that may impact EB in a change of suppliers.
Business Case Assignment Part two :
EB’s primary method of shipping goods to Skyway is via TL service. When shipping inTL quantity, EB has paid the freight expense. Skyway represents the majority of EB’ssales and Skyway has recently been pressuring EB to provide LTL service at EB’sexpense. Skyway often has larger inventory volume than they require and this requiresstorage space that could be used for other, fast moving products.EB’s management is concerned that they may lose Skyway as a customer if they don’tprovide LTL service at their own expense. In anticipation of this, you have receivedestimates from three large LTL carriers. Each carrier has classified the product atdifferent levels.
The management team is not familiar with freight classification systems and has askedyou to provide clarification on what this is and how it might impact LTL service. Inaddition, the management team has requested that you provide a summary of theimpacts on the product during transportation and any administrative or operationalchanges.
Specifically, you have been asked to:1. Provide a summary for the management team of the factors that influence freightclassification and what the impact of a different classification would mean to EB.2. Discuss the impacts of a change from TL to LTL service on the product (such ashandling) and the organization (such as administration and internal processes).
Business Case Assignment Part 3
EB is aware that many of their boutique specialty stores would prefer to have EB directship their bottles to customers versus the boutique specialty store having to maintaininventory. Some boutique specialty stores have proposed an in-store display wherecustomers could view the product, order it instore, and then have it delivered direct tothe home from EB’s facility in Winnipeg.
Currently, EB only ships individual bottles when customers have warranty issues andthey are sending a replacement bottle. EB’s experience with this has been poor as thecarton is lightweight cardboard and was only designed for ‘in store’ presentation. Manyof the individual bottles shipped under warranty repair are damaged before they arriveat their customer. When the bottles ship outbound they are packaged in a master cartonthat holds 30 bottles and then palletized. Under this system of using mastercarton and palletization, the units rarely are damaged.
You have been asked to prepare a preliminary report that would discuss the logisticalimpacts including general cost assumptions, transit time, internal process andadministrative changes that would be required to support such an initiative.Specifically, you have been asked to:1. Highlight the logistical impacts of expanding a direct to consumer service (ie.cost, transit time, packaging);2. Discuss the organizational impacts of a change in service (ie. internal processes,administrative changes).
Your response should be approximately 3,000 words (1000 each part) and contain abrief introduction, your analysis and recommendation, and finally a conclusion. You canuse below template for each part to get started. Please submit your assignment in Word(.doc or .docx) format.A cover page with the team member names is required.For this assignment, you do not need to include a table of content, or executivesummary.However, you are encouraged to include appendices of reference material whereappropriate (i.e. computation tables or reference material not required in the discussionportion of your submission).IntroductionBriefly state the objective of the report which includes the problem statement(s).Topic 1Define the challengeConsider the optionsEvaluate the optionsProvide a recommendation (this applies for some challenge questions, but not all)Topic 2Define the challengeConsider the optionsEvaluate the optionsProvide a recommendation (this applies for some challenge questions, but not all)ReferencesIf applicable, include any computation tables, reference material or citations notrequired in the discussion portion of your submission here.Part One RubricExceeds Standards Meets Standards Fails to Meet StandardsModal ComparisonSuccessfully compares andcontrasts the modes oftransportation.
