Case Study 24

Case -1
Super Dolls is a toy manufacturing company which is in the business for the past two
decades. The manufacturing unit is situated in Mumbai, while its sales and marketing are
spread over a large geographical area, especially in the major cities across the country. Over
the years, a number of competitors have sprung in the field. Far from child’s play, the
company found that the toys’ sector is a tough business. Some of the problems faced by it
are:
ØT here is a massive sale during the festival seasons. If the company’s product is delayed,
the valuable market is missed.
Ø“Fashion” or “cult”status products influence the market. Any wrong decision in this matter,
means loss of sales and build-up of unwanted inventory
ØThere are high marketing and promotional costs. If these programmes go out, the sales
drop massively
ØAny misjudge of the market can also mean closing down of the company
ØThe company has problems regarding stock holding at its distribution centers. This is
mainly due to wrong inputs from feedbacks and improper surveys.
ØThe company relies mainly on hired fleet of road transport. The services are not up to the
mark in terms of delivery schedules, safety of goods from pilferage/theft, and mishandling
of product.
ØMarketing strategies are far from adequate. They are not effective enough to counter the
strategies adopted by the competitors.
You are called upon by the management of Super Dolls to head their logistics
operations. You are required to study and guide the company regarding the following
matters.
a ) Warehousing at distribution centers and large retailers to cut down inventory costs plus
other suggestions in order to reduce inventory carrying costs
b)Advantages of outsourcing in terms of preparing girls’ and boys’ toys, toys in local
languages, toys for different age ranges, packaging, effecting savings on damages/transport,
responding fast to customers’ requests, etc.
c ) Alternatives with regard to having own fleet of trucks
d)How to cut down cost on advertisement campaigns by alternative forms of spreading
awareness
e)Suggestions to counter competitors’ strategies
Case 2
Food Savouries Limited is engaged in the manufacturing of various types of fast food items that are ready-
to-eat variety. It has been in the business for the past 12 years. It has its factory as well as the
processing unit in Navi Mumbai. The raw materials required are mainly vegetables, chicken
which the company procures from either the local vendors, or from various suppliers
situated at Nasik, Pune and other districts. The required materials are procured with the
help of hired transporters. However, the hired transporters do not care much about the
preservation of the goods. Hence, about 20% of the goods are lost due to damage,
deterioration, pilferage, etc. Again, the hired transporters are unreliable with regard to their
availability as well as prompt delivery schedules. The company’s products are quite popular with the
customers who are situated in Mumbai, Navi Mumbai, Pune, etc. However, the company stands to
Lose the market due to erratic supply schedules which do not cater promptly to the
customers. The packaging of the products is attractive, but it does not preserve
the product for a long time. The shelf-life is only about 5 hours, if the goods are
not properly refrigerated. Loss on this account is about 10%.The company has about 10
distribution centres. But there does not seem to be the much coordination between these
centres. Logistical information system is not adequate. Due to this, the company is unable to
expand its business. In fact, due to competition, there is fear that the company may stand to
lose its existing clientele. Due to mismanagement, the company is unable to meet increase
in the demands during festival seasons and holidays. You are appointed as a logistics
consultant. You are required to put forward your suggestions with regard to:
1.Setti ng-up of proper, eff ecti ve logisti cal informati on system to improve
coordinati on
[Note: Discuss about Logistics as an integrated process, ensuring proper planning]
2.Eff ecti ve forecasti ng system to reduce inventory carrying cost, wastages,
damages, pilferages
[ Note: Forecasting can be in terms of door-to-door surveys, questionnaires, telephonic
interviews. For markets/stores that are close-by, think of JIT strategies]
3.Setti ng-up of eff ecti ve purchasing and distributi on system
[Note: Quality control with regard to purchases is required. Prefer those suppliers who can
supply goods in their own transport]
4.Improved system of storage, handling and packaging
[Note: Study warehousing, material handling system and packaging. Write/discus relevant
points relating to the question.]
5.Alternati ve modes of transport to reduce/eliminate wastages
[Note: Study has to be made regarding capital investment in having own fleet of specialized
trucks and related variable costs versus hiring specialized fleet of trucks. In case of
hired trucks, agreement should be made with regard to compensation to be paid by the
transport company in case goods are damaged/pilfered by them]
6.Ways and means to tackle and counter competi tors’ strategies
[ Note: Analysis as to why competitors are having a “cutting edge”. Improvement in the
company’s performance vis-à-vis performance in inbound logistics, processing,
packaging, storage/warehousing, marketing/sales programmes. Quality and taste of
the product may be altered to suit various sections of customers. Different sizes of packets to
suit customers’ budget]

Case Study 24

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Case -1

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