Name: ………………………… Roll No.: …………………………...
NATIONAL INSTITUTE OF TECHNOLOGY CALICUT
Department of Mechanical Engineering
End Semester Examination, Winter Semester 2020 - 2021
Eighth/Sixth Semester B. Tech. (Common for All)
ME3126D SUPPLY CHAIN MANAGEMENT
Time: 120 Minutes Maximum Marks: 25
Answer all the questions. Assume missing data, if any; clearly state all the assumptions. XY
represents last two digit of your roll number.
1. What factors lead to batching of orders with a supply chain? How does this affect
coordination? What actions can minimise large batches and improve coordination? [2]
2. Discuss the supply chain of Jaipur Rugs and highlight the role of ERP in managing its
network. [2]
3. Discuss how big data analytics and internet of things are changing the future of supply
chain management. [2]
4. Somerset Furniture Company imports furniture components and pieces from several
manufactures in China and then assembles the finished furniture pieces and adds
hardware at a distribution center before shipping the finished pieces of furniture on to
its customers’ warehouses in several states. Furniture shipments arrive from China (in
containers) at three U.S. ports in the United States—New Orleans, Savannah, and
Norfolk. These containers are then transported to Somerset’s distribution center for
final furniture assembly before they are shipped in truckloads to five customer
warehouses. The (x, y) coordinates of the ports and warehouses and the annual
container truckload shipments are shown in the following Table 1. Determine the best
site for Somerset’s distribution center using the center-of-gravity technique.
Table 1: Coordinates and Truckload Shipments Data
Port/Warehouse Coordinates Annual Truckloads
New Orleans 1100 700 7XY
Savannah 2700 1400 14XY
Norfolk 2800 2200 22XY
1 200 1200 12YX
2 1400 1500 15YX
3 700 2300 23YX
4 1200 2700 27YX
5 2100 2600 26YX
Suppose Somerset furniture is considering three possible sites for its distribution center,
which are the most economical in terms of land and building cost. The coordinates for
the three potential sites are site A (1700, 800), site B (2400, 1700), and site C (1800,
2200). Using the load-distance technique, determine the best site for the distribution
center. [6]
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5. Magic Mattress, a mattress manufacturing company in Bangalore, is trying to finalize
its distribution network for northern India. The company has a manufacturing facility
and a central inventory depot in Bangalore attached to it. In the northern region, the
firm presently markets its product through six demand points—Delhi, Kanpur,
Jalandhar, Jaipur, Faridabad and Dehradun. Each of these demand points belongs to
different states and union territories. If the firm serves retailers within the region from
distribution centres (DCs) located in the same region (state/union territories) then it
does not have to any tax (SGST). If the firm locates DCs in all six regions it can avoid
paying SGST completely. The fixed cost per period of installing (apportioned) and
operating a DC is Rs 3,5XY per week. Transportation cost is Rs 0.25 per kilometre per
unit, and the unit cost of a mattress is Rs 2,5YX. The firm has decided to locate at least
one DC in the northern region so that the lead time for the retailer is less than 48 hours.
The firm will try to serve a market in any region from a DC located closest to the market.
Utilising Table 2 and Table 3 data, the firm wants to decide the optimal location of its
DCs so as to minimize the total cost. The total cost will include transport cost, fixed
facility cost and GST-related cost (5%/Unit). [7]
Table 2: Demand point specific data
Delhi Kanpur Jalandhar Jaipur Faridabad Dehradun
Distance from 2050 1855 2415 2000 2000 2240
central warehouse
Weekly Demand 45 18 19 17 10 7
Table 3: Distance matrix (in km)
Warehouse/
Delhi Kanpur Jalandhar Jaipur Faridabad Dehradun
markets
Delhi 0 480 375 260 30 235
Kanpur 480 0 855 520 450 575
Jalandhar 375 855 0 635 405 365
Jaipur 260 520 635 0 290 495
Faridabad 30 450 405 290 0 260
Dehradun 235 575 365 495 260 0
6. XYZ, a manufacturer of printing inks, has five manufacturing plants worldwide. Their
locations and capacities are shown in Table 4 along with the cost of producing 1.2 ton
of ink at each facility. The production costs are in the local currency of the country
where the plant is located. The major markets for the inks are North America, South
America, Europe, Japan, and the rest of Asia. Demand at each market is shown in Table
4. Transportation costs from each plant to each market in U.S. dollars are shown in
Table 4. Management must come up with a production plan for the next year.
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Table 4: Capacity, Demand, Production, and Transportation Costs for XYZ
North Europe Japan South Asia Capacity Production
America America Tons/Yr Cost/Ton
US $700 $1300 $2000 $1200 $17XY 215 $10,000
Germany $1400 $650 $1400 $1400 $1600 525 €15,000
Japan $20XY $1600 $350 $2300 $950 70 ¥1,800,000
Brazil $1200 $16XY $2300 $800 $2300 245 R$13,000
India $2200 $1500 $10XY $2300 $900 90 ₹400,000
Demand 250 230 150 220 130
(tons/yr)
Table 5: Exchange Rate (as on May 6th 2021)
US EURO YEN REAL RUPEES
US ($) 1 0.83 109.24 5.31 73.78
EURO (€) 1.21 1 131.80 6.40 88.99
YEN (¥) 0.0092 0.0076 1 0.049 0.68
REAL (R$) 0.19 0.16 20.58 1 13.89
RUPEE(S ₹) 0.014 0.011 1.48 0.072 1
a) If exchange rates are as in Table 5, and no plant can run below 70 percent of
capacity, how much should each plant produce and which markets should each plant
supply?
b) If there are no limits on the amount produced in a plant, how much should each
plant produce?
c) Can adding 20 tons of capacity in any plant reduce costs? [6]
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