Westminster Company.The Westminster Company assessing the efficiency and effectiveness of its logistics system design. A number of internal and external influences have made the firm reconsider its current system. As it stands, Westminster operates three separate distribution systems, one for each domestic sales division. It may seem obvious that consolidation of the systems can significantly improve efficiency, but there are a number of constraints placed on the company to make the determination a complicated one. You should consider the various pieces of cost information as well as numerous qualitative factors in order to reach conclusions for this case. As with all case questions, answers are not necessarily clear-cut though all responses should be adequately justified.
What impact would the three new alternatives have on transfer and customer freight cost? Why?
What impact would warehouse consideration have on inventory carrying costs, customer service levels, and order fill rate?
How are warehousing costs affected by the decision to use third party or private warehouse facilities? What effect would this have on handling, storage, and fixed facility costs?
What effect would shipping mixed shipments from consolidated distribution centers have on individual company cost and performance?
Evaluate the eight supply chain processes in terms of customer classification and degree of centralization/decentralization of required functionality (use the matrix in the case study).
Given all available information briefly describe the logistical system design you would recommend for Westminster’s integrated consumer products.