BSc Aviation Management Global Logistics (December 2014)
You are the Logistics Manager for the Middle East Division of MedicalCare International, a global company manufacturing pharmaceutical and cosmetic products.
You are responsible for managing the company’s Middle East Regional Distribution Centre in Jebel Ali where you currently receive pharmaceuticals from a factory in Rotterdam, Netherlands and cosmetics from a factory in Baltimore, USA. The goods are consolidated in your Jebel Ali Regional Distribution Centre before supplying distributors located in the Gulf Cooperation Council Countries.
The company’s sales across the globe have grown significantly and the two factories supplying the Middle East have been running at full capacity for some time. A year ago a new pharmaceuticals factory was built in Sao Paulo, Brazil and a new cosmetics factory in Bangalore, India. Until now these factories have been supplying their domestic markets only.
As the factories in the Netherlands and the USA have insufficient capacity to continue supporting the Middle East market, a decision has been made whereby the Middle East will be supplied from the two new factories in future.
Since neither of the factories have experience in supplying foreign markets you have been asked to visit each location and ensure you and the Export Manager at each factory fully understand the logistical issues involved in transporting the goods from the production site to Jebel Ali.
The factories focus on manufacturing and do not have any of their own vehicles.
Each factory will ship approximately 5 containers per week.
Goods are normally shipped in 20ft containers (50% dry, 50% reefer to maintain +25c).
A small percentage of goods are likely to be transported by air when there is a requirement for goods to be dispatched urgently.
Inventory held in Jebel Ali
Typically you would hold the following inventory levels in Jebel Ali:
Pharmaceuticals 4 weeks cover
Cosmetics 6 weeks cover
Discuss the various logistical issues you would have to consider before commencing the export operation, taking into account the various procedures that need to be considered, the modes of transport you may need to use and the port you will select to export the products.
2 Transit Times and Inventory Levels
(a) Produce a table showing the transit time by sea from your current suppliers’ ports of export, Rotterdam and Baltimore, to Jebel Ali, compared to the ports you are likely to use for exporting from Brazil and India.
(b) Based on these transit times discuss whether you would consider reviewing the level of inventory you hold in Jebel Ali of pharmaceuticals and cosmetics and, if so, what recommendations you would make.
(A further 20 marks for overall clarity, conclusion and recommendations)
3,000 words (Maximum 3,200 words)
The report is to be submitted by the date shown on Moodle