STRATEGY ANALYSIS

LOGISTICS

Daniela Osorio

Angie Díaz

Laura Gorrais

Sofía Chaparro

Teacher: Enrique Romero Motta

INTERNATIONAL SCHOOL OF ECONOMIC AND ADMINISTRATIVE SCIENCES

CHÍA, CUNDINAMARCA

OCTOBER, 2018
A. Calculate the production costs of shirts and pants

The strategy that we applied was analyze the cost of shirts and pants taking into

account the demand of each product in the United States and United Arab Emirates. We

made the cost analysis for the lowest and also for the highest demand, and with this

information we will be able to compare the different combinations of demand (high of

shirts-low of pants, low of shirts-high of pants, high of shirts-high of pants or low of

shirts-low of pants) and decide which one is the most efficient option, as seen as the excel

file named “Challenge logistic”.

USA

UAE
 B. Make the cubic capacity of the chosen containers in black stowage or according

to the chosen packaging system (palletized, etc )

We decided to send the merchandize quarterly so we can save more money in

transportation costs than doing it monthly. Because if we decide to send the combination of

low-low demand (the cheapest one), we are risking ourselves of being asked for more

merchandize by the middle of the trimester, so we prefer to send the high-high demand and

be sure that the merchandize won’t deplete before the next shipping. Also we decided to send

the charge without pallets because we are sending clothes that can not be damaged along the

journey, also we count with the insurance and the protection of the container.

That is why we chose the “dry cargo 40” sending the maximum demand in 6

containers as show below, sending 1500 boxes of shirts (15kg), each box with 20 t-shirts

and 7500 boxes of pants (17kg) each box with 16 pants.

C. Calculate the gross weight of the cargo in tons to be exported taking into account

the tare of the chosen container

 We made the analysis for 6 types of containers with different measures and capacity.

According to this, each container´s weight changes, so we made the analysis considering each

combination of demand.

The results for the monthly analysis were:

· LOW DEMAND IN USA-LOW DEMAND IN UAE: The most

efficient container was the “dry cargo 45” with a gross weight of 40445

kg.

· LOW DEMAND IN USA-HIGH DEMAND IN UAE: The most

efficient was “dry cargo 53” with a gross weight of 52781 kg.

· HIGH DEMAND IN USA-LOW DEMAND IN UAE: The most

efficient was “dry cargo 53” with a gross weight of 45906 kg.

· HIGH DEMAND IN USA-HIGH DEMAND IN UAE: The most

efficient was “dry cargo 53” with a gross weight of 56531 kg.
and comparing this we end confirming that for our strategy of choosing the container that has

the lowest weight and that can carry the highest demand, the one that suits conditions better is

the dry cargo 40 with a gross weight of 172,5 tons.

D. Export cost matrix to USA and UAE a. Incoterm must be defined to be used according

to the selected transport medium b. you should consult the information regarding internal

transport costs c. you should consult the information regarding the costs of documentation in

the export and customs brokerage d. you should consult the information regarding port

costs according to the type of port e. you should consult the information regarding

international transport costs f.you should consult the information regarding international

insurance costs

Strategy: The strategy we used to manage our cost matrix was to send all the merchandise,

that is, both the one that goes to the United States and the one that goes to the United Arab

Emirates in a single trip and in the same truck from Bogotá to the port of Barranquilla. We

decided to optimize the internal transport time as much as possible, so we predestined only

one hour of waiting for this process. Later, we assigned a four hour time to the loading

process in the port of Barranquilla, because the boxes must be packed in a specific way to

ensure that as much space as possible is optimized. Later, when the ship arrives at the port of

San Francisco in the United States, the merchandise corresponding to this country will be

unloaded in a time of six hours. Then, the weight of the merchandise that will remain in the
United States will be subtracted, and the ship will take course to the port of Dammam in the

Arab Emirates, arriving successfully the merchandise destined for that country and also

destining a time of 6 hours for the unloading.

Colombia-EUA
USA-UAE
E. Calculate the number of exports per year (USA wants between 5000 to 10000 units of

each product per month and UAE wants between 30000 to 40000 units per month of each

product)

For the decision making, we chose to export only 4 times per year (once every trimester),

because we realized that we could save transportation costs as a result of less shippings and

higher demands, ending in a total exportation of 36000 pants and shirts with a cost of

production of $2.509.800 and with the interest rate of calculating the cost of the inventory we

end with a total cost of production of $2.961.564.000 per year.

REFERENCIAS
● Características y medidas del contenedor Dry 20' y 40' | DSV. (2018). Retrieved from

http://www.es.dsv.com/sea-freight/contenedores-maritimos/dry-containers

● (2018). Retrieved from https://www.maersk.com/en/solutions/shipping/dry-cargo

● 40' HIGH-CUBE container: internal and external dimensions. (2018). Retrieved from

https://www.searates.com/reference/equipment/3/

● 45′ HC DC – (45′ HIGH CUBE DRY CARGO CONTAINER) – Oceanbox Containers.

(2018). Retrieved from http://www.oceanboxcontainers.com/4045-ft/45-hc-dc-45-high-

cube-dry-cargo-container/

● (2018). Retrieved from http://www.seabox.com/catdl/sb2/SB54819/SB54819.pdf