Spartan Plastics Executive Brief

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School

Northeastern University *

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Course

2301

Subject

Computer Science

Date

Apr 3, 2024

Type

docx

Pages

1

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Professor Power SCHM2301 26 February 2024 Spartan Plastics Executive Brief Cost of Shipping (per day) for Consolidated Shipping (CS): = ((487+88+65) miles*$6/mile) + ($250*3) = $4,590 Cost of Shipping (per day) for Amalgamated Integrated Services (AIS): = (521 miles*$6/mile) + ($500*3) = $4,626 Recommendation: If the decision was purely based on cost, Spartan Plastics should choose the Consolidated Shipping approach ($4,590 compared to $4,626). However, while CS may be the slightly cheaper option, there are other important factors to consider. First, The Amalgamated Integrated Services method comes with less risk. The consolidated shipping approach poses the risk of losing our entire supply since it is all on a single truck. With AIS, the shipment is cross decked at Ypsilanti and then split up into three other shipments. These type of “milk run” deliveries as demonstrated by the Consolidated Shipping approach are susceptible to a large number of delays and disruptions, so cross-decking as emphasized by the AIS approach would help spread out and potentially reduce this risk. As well as this, the lead time is greater with the CS approach than the AIS approach since CS uses market consolidation where the one truck would make a stop at every automotive plant on its way to Spartan Plastics. Further, this negatively impacts customer satisfaction since Consolidated Shipping would take longer for shipments to be delivered. To align with the company’s mantra of “high-quality components, designed right, built right, sold at a fair price, and delivered on time,” it is in their best interest to choose the Amalgamated Integrated Services approach as it best aligns with their own service characteristics. In the long run, this $36 difference will matter much less compared to the greater impacts that it would have on supply risk and customer satisfaction.
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