You are a Supply Chain Analyst for a well-respected, designer leather goods company. The Chief Supply Chain Officer has tasked you with developing an end-to-end supply chain concept for the sourcing, manufacturing, and omni-channel distribution of a new high-end ladies handbag to millions of customers in the United States and Europe. Your company has a strong stance on sustainability and fair-labor standards and is willing to pay premiums to ensure its actions are in alignment with this position. Additionally, the company is seeking to develop strategic relationships with 3PL providers to assist in the management of inventories and distribution while reducing internal overhead expenses and personnel. The specific inputs of production for each handbag are: three yards of cowhide leather, two yards cotton for the lining, one gold-plated large zipper for the exterior, one small zipper on the interior, and one gold-plated strap buckle. The handbag is available in black and brown leather.
Dimensions: 18.2 x 11.6 x 3.7
Weight: two lbs.
Marketing predicts a sales price of $200 (U.S.) and the following sales rates for the next three years (assume a 50/50 split between black and brown colored bags and assume 40 percent retail sales compared to 60 percent online sales):
- NE United States: 300,000 units, 450,000 units, 150,000 units
- Retail Locations: New York, Boston, Philadelphia, Atlantic City, Chicago
- SE United States: 200,000 units, 350,000 units, 175,000 units
- Retail locations: Charlotte, Atlanta, Miami, Nashville, St Louis
- NW United States: 300,000 units, 450,000 units, 150,000 units
- Retail locations: Seattle, San Francisco, Denver
- SW United States: 350,000 units, 500,000 units, 150,000 units
- Retail Locations: Los Angeles, Phoenix, Las Vegas, Austin
- France: 350,000 units, 500,000 units, 150,000 units
- Retail Location: Paris
- Germany: 300,000 units, 450,000 units, 150,000 units
- Retail locations: Berlin, Munich
- United Kingdom: 200,000 units, 350,000 units, 175,000 units
- Retail Location: London
Over the course of five weeks, develop a 15–20 page, APA formatted, business proposal and supporting five-slide presentation detailing the global supply chain to support the roll-out of the new ladies handbag. Here is a great resource to help you write a business proposal:
The proposal should provide business case analyses for sourcing, manufacturing, and the global omni-channel distribution network. Sourcing decisions should be supported by analysis and comparison of at least two Pacific Rim nations and the United States. Manufacturing recommendations should be supported by analysis and comparison of the United States and two European nations,. The distribution network recommendation should establish a strategic partnership with a global Third-Party Logistics (3PL) service provider and describe the supporting international logistics network. It is certainly permissible, even encouraged, to select multiple nations for sourcing, manufacturing, and locations of distribution nodes.
The keys to success in this final project are creativity supported by solid business analysis; clearly articulating the methodology used to derive recommendations; use of credible sources for facts, frameworks, and evaluation criteria; and finally, the recommendations meet the operational requirements necessary for a successful roll-out of the new handbag at an acceptable profit. Students are expected to determine which supply items are used in the making of the handbags and where they are sourced. Students are expected to determine freight rates and accessory charges for PCH&T. Current exchange rates should also be considered, as well as trends in currency fluctuations. It is also important for recommendations to consider the financial impacts of international trade, regulatory restrictions, free-trade agreements, political considerations, and most importantly, the description of the framework used for recommendations on which nations to locate supply chain activities. Students must make relevant assumptions throughout the course of this assignment. It is important that students explain the necessity and validity of all assumptions.
Week 4: research and define appropriate frameworks with accompanying screening and evaluation criteria for selecting sourcing solutions, manufacturing locations, and 3PL providers. Each framework with accompanying evaluation criteria should be one to two pages in length and include cost, profitability, operational constraints, and other factors like political, economic, labor, environmental, and sustainability considerations. Ensure appropriate use of citations according to APA format. (10 percent)
Week 5: determine total supply requirements by year and estimated costs for the three years. Apply frameworks to determine the locations from which to source supply requirements, manufacture the handbags, and 3PL partner. There should be two to five pages per selection. (15 percent)
Week 6: slide presentation preparation and submission. (5 percent)
Week 7: compilation and packaging for final submission. Final product should include an executive summary, annotated bibliography, and appropriate tables, graphs, and other graphics to appropriately illustrate the proposed global supply chain. (10 percent)