Spartan Plastics Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

Spartan Plastics Case Study Solution

Introduction:

Spartan Plastics is a medium sized producer of premium quality plastic components, which are used in the interior of the trucks and cars. The company was found in 1976, and the business model of the company comprises of selling premium quality plastic components at fair prices. The company is located in St. Louis, Missouri,and the major customers of the organization are comprised of three automobile companies, General motor, Ford and Chrysler. Currently, the organization ships the plastic components to these customers who are located in Detroit, Lansing and Toledo areas. In addition, the company is known for its advanced supplier diversification program and recruitment of minorities for its workforce.

Problem Statement:

Currently, the organization delivers the components to its customers through a local shipping company, LTL carrier, which charges $0.05 per hundredweight per mile. The company expects that the shipping volume will increase by 20-25% in the coming years, and is concerned that the profitability might be reduced as a result of uncontrollable higher shipping costs and cost-sensitive customers. In order to reduce the shipping costs and to ensure the profitability of the business, two proposals or price quotation were presented by two logistic companies in the Midwest, where the major three customers of the company are based. The shipping manager of the company is facing a dilemma regarding the selection of the proposal as she is concerned about the cost implication of the proposals and the potential qualitative aspects,which are required to be considered while evaluating the proposals.

Analysis of Current Situation and the Proposals:

Current Situation:

Currently,the company uses a local carrier from St. Louis, LTL, who ships the components to each of the assembly plant, at a shipping cost of $0.05 per hundredweight per mile. Considering the carrier ships 10,000 pound components per day to each assembly plant; the total shipping costs per day amounts $7690(See Appendix 1)............

This is just a sample partical work. Please place the order on the website to get your own originally done case solution.