HW 6: Freight Transport¶
ISE 754, Fall 2024
Assigned: Mon, 7 Oct (Individual Assignment)
Due: 10:00a, Wed, 16 Oct
Solve questions 1 and 4 by hand (you can submit a scanned copy of your solution, or you can turn in a paper copy in class), and then, for the other questions, use the Code cells in this Jupyter Notebook to answer the questions. Please run all the cells in your notebook and then submit it as a .ipynb file, along with a .html or .pdf copy, via Moodle. (There is a Run All Cells command under the Run menu.)
(1) What is the difference in the transport charge to ship 25 cartons of a product LTL from Raleigh to Gainesville using the undiscounted tariff given below as compared to using the LTL rate estimation formula with a PPI of 144.3? Each carton weighs 70 pounds and occupies ten cubic feet.
(2) On average, 75 tons of a product are shipped 625 miles from your manufacturing plant to your DC yearly. The product is produced and consumed at a constant rate throughout the year. Currently, the product is shipped using independent P2P truckloads. What would be the impact on total annual logistics costs if the average interval between shipments was restricted to not exceeding one week and, if the shipment size is equal to one week’s demand, then both TL and LTL are considered? The PPIs for TL and LTL are 162.1 and 203.7, respectively; a truck’s cubic and weight capacities are 2,750 ft3 and 25 tons, respectively; each ton of the product is valued at \$12,000; its density of 12 lb per ft3; the inventory carrying rate is 30%; and in-transit inventory costs can be ignored.
(3) It is expected that 100 and 120 tons of products A and B, respectively, will be shipped each year from your DC to five customers located in Asheville, Winston-Salem, Greensboro, Durham, and Raleigh, with each customer receiving 20, 25, 30, 15, and 10 percent of the total demand, respectively. Full P2P truckloads of A and B will be shipped FOB origin to the DC from suppliers located in Wilmington and Statesville, respectively, and full P2P truckloads containing a mix of both products will be shipped FOB destination to each customer. Each carton of A and B weighs 100 and 50 lb, respectively, and occupies 25 and 5 ft3, respectively. Each truck’s cubic and weight capacity is 2,750 ft3 and 25 tons, respectively. Assuming that I-40 will be used for all travel (see figure below), where should the DC be located to minimize transportation costs?
(4) Each year, 720, 120, and 480 units of three different raw materials are to be shipped each year to a manufacturer in Austin, TX, from a supplier in Chicago, IL, who supplies similar materials to manufacturers all over the country. Each unit weighs 16, 150, and 40 lb, occupies two, six, and 12 ft3, costs \$500, \$200, and \$100, and will have a salvage value after one year of \$50, \$180, and \$80, respectively. Assuming that the materials are used at a constant rate and that they will be transported via truck, determine, for each material, how it should be transported (TL, LTL, or as aggregate TL), how frequently it should be shipped, and how much of each raw material should be transported in each shipment.
(5) iChain, Inc., has just purchased a DC that is located in Durham, NC to serve its retail facilities located in VA, NC, and SC. The DC will receive the products from suppliers located throughout the U.S. Independent P2P TL, or LTL will be used for all transport, and the product will be consumed at a constant rate at all of the retail facilities. Determine the transshipment policy that iChain should use to operate the DC, where you should decide if all products should be stocked with no coordination or should all be cross-docked using a single shipment interval. The file HW6data-sup.csv lists the ZIP code (zip), volume (cu, ft3), weight (wt, lb), cost (uc, \$), and salvage value after one year (sv, \$) of each unit of 64 different products. The file HW6data-cust.csv lists the ZIP code (zip) of each of the 28 retail facilities, and the file HW6data-dem.csv lists the annual unit demand of each product for each retail facility.