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| Section | Objectives |
|---|---|
| E-Supply Chain Management | - Differences Between Logistics and Supply Chain Management - Warehouse Management System (WMS) - Information Flows and Information Systems Integration - Modern Fulfilment Tools and Applications in Supply Chain - Big Data and IoT in Supply Chain |
| Demand Planning and Forecasting | - Spreadsheet Newsvendor Models - Demand Forecasting and Purchase Price Variance (PPV) Savings - Supply Chain Issues for Short Life Cycle Products - Integrated View of Procurement, Manufacturing and Operations Management - Issues and Trade-offs in Global Supply Chain Management - Revenue Management |
| Distribution and Operations Management | - Stock Management - Order Management - Warehouse Management - Transport Management - Introduction to Distribution Network |
| Major Supply Chain Issues: Sourcing Materials and Services | - Developing Productive Supplier Relationships in a Competitive Market - Major Challenges in Supply Chain Management Today - Role of Logistics in Supply Chains - Introduction to Global Supply Chain Management - Inventory Management |
| Principles of Supply Chain Management & Logistics | - Factors Affecting Supply Chain Management - Supply Chain Processes - Introduction to Supply Chain Management - Management Components of Supply Chain Management |
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NEW QUESTION # 63
The impact of the lack of coordination on supply chain processes decreases for the following measure.
Answer: D
Explanation:
Lack of supply-chain coordination causes the level of product availability to decrease . This contrasts with several cost and time measures-manufacturing cost, transportation cost, and replenishment lead time- which generally increase when coordination deteriorates.
The mechanism begins with the bullwhip effect. Greater order variability makes demand harder for upstream participants to predict and satisfy. Manufacturers require additional capacity or inventory, transportation becomes more irregular, and replenishment schedules become less reliable. Despite carrying more aggregate inventory, the supply chain may have inventory positioned in the wrong products, locations, or periods.
Customers therefore encounter more stockouts and lower service availability.
This illustrates an important supply-chain principle: more inventory does not automatically produce better availability. Poor coordination can simultaneously increase total inventory and reduce customer service because the stock is not synchronized with actual demand.
Established supply-chain performance analysis identifies manufacturing cost, inventory cost, replenishment lead time, transportation cost, and shipping/receiving cost as increasing under poor coordination, while product availability decreases .
Therefore, B is the only listed performance measure that moves downward as a consequence of inadequate coordination.
Reference Topic: Business Value and ROI of Supply Chain Excellence - Coordination, Product Availability, and Performance Measurement.
NEW QUESTION # 64
The practice of combining shipments for several retailers on the same truck is known as
Answer: A
Explanation:
A milk run is a transportation arrangement in which one vehicle follows a planned route involving multiple pickup or delivery locations rather than making a separate dedicated trip for each destination. Combining shipments for several retailers on the same truck is therefore a classic milk-run application.
The primary advantage is transportation consolidation. Individual retailer requirements may be too small to economically justify a dedicated truckload. Combining those requirements allows greater vehicle utilization while preserving relatively frequent deliveries. Milk runs can therefore reduce transportation cost per unit, lower individual shipment sizes, and support smaller inventory lots at downstream locations.
An LTL shipment refers more broadly to freight that does not occupy an entire trailer and is normally consolidated by an LTL carrier with other customers' freight. That is not the specific routing practice described here. A truckload shipment generally refers to a dedicated or sufficiently large shipment using an entire vehicle. An ASN-Advanced Shipping Notice-is an electronic information message advising the receiver about an incoming shipment; it is not a transportation route.
Milk-run design is particularly useful where several customers or suppliers are geographically clustered and demand regular, relatively small replenishment quantities.
Reference Topic: Transportation and Logistics - Milk Runs, Shipment Consolidation, and Route Design.
NEW QUESTION # 65
Examples of regional trade agreements include all of the following EXCEPT:
Answer: D
Explanation:
The Association of Indian Markets (AIM) is the exception because it is not one of the recognized regional economic or trade organizations represented by the other alternatives.
ASEAN is an established regional organization encompassing Southeast Asian economies and supporting progressively deeper regional economic integration. The European Union represents an advanced regional economic and political integration framework with extensive provisions governing movement of goods, services, capital, and people. MERCOSUR-Southern Common Market-is a South American regional integration arrangement established to facilitate trade and economic cooperation among participating economies.
Regional trade arrangements are important to supply-chain design because they can influence tariffs, customs requirements, market access, rules of origin, sourcing opportunities, and the attractiveness of potential manufacturing and distribution locations. Consequently, supply-chain professionals must incorporate regional trading structures into global network decisions rather than considering only direct manufacturing costs.
The facility-location source from which this question is drawn explicitly identifies the Association of Indian Markets (AIM) as the EXCEPT option.
Reference Topic: Supply Chain Strategy and Global Context - Regional Trade Agreements and International Network Design.
NEW QUESTION # 66
Aggregating across products, retailers, or suppliers in a single order allows for a reduction in lot size for individual products because
Answer: D
Explanation:
Order aggregation reduces the effective fixed cost attributable to each individual product or trading partner.
Ordering and transportation frequently contain costs that are incurred per replenishment event rather than in direct proportion to the quantity of one particular SKU. Examples include purchase-order processing, truck dispatch, shipment administration, loading, and certain receiving activities. When several products, suppliers, or retail destinations are consolidated into one replenishment movement, those fixed costs are shared across the combined order rather than being borne by one item.
This cost-sharing effect changes the economic lot-sizing trade-off. Because the effective fixed ordering or transportation cost associated with each product becomes smaller, the supply chain can replenish each individual item in smaller quantities without causing an excessive increase in ordering cost. Smaller lots consequently reduce average cycle inventory and associated carrying cost while retaining transportation economies.
This is precisely why aggregation is an important cycle-inventory lever: it preserves economies of scale at the shipment level while allowing smaller product-level replenishment quantities. The underlying principle is also reflected in established supply-chain lot-sizing material, where aggregation spreads fixed ordering and transportation costs across multiple products or supply-chain entities.
Reference Topic: Inventory and Warehousing - Cycle Inventory, Lot Sizing, and Order Aggregation.
NEW QUESTION # 67
Total ordering and holding costs
Answer: D
Explanation:
The economic order quantity represents the lot size that balances two opposing inventory-cost components:
ordering cost and holding cost. Ordering larger quantities reduces the number of replenishment orders placed during a period, thereby lowering annual ordering cost. However, larger quantities increase average cycle inventory and therefore increase annual holding cost. Ordering smaller quantities produces the reverse effect.
At the EOQ, the combined annual ordering and holding cost reaches its minimum. A significant managerial characteristic of the EOQ cost curve is that it is comparatively flat near this minimum. Consequently, modest deviations above or below the mathematically optimal order quantity generally produce only a small increase in total relevant cost. This is why total ordering and holding costs are described as relatively stable around the economic order quantity .
This property is operationally useful because managers do not normally need to implement the calculated EOQ with absolute numerical precision. Practical constraints such as case-pack quantities, pallet sizes, supplier minimums, transportation capacity, and scheduling considerations can justify a nearby quantity without materially damaging cost performance.
Therefore, option B accurately describes the behavior of total ordering and holding cost near EOQ.
Reference Topic: Inventory and Warehousing - EOQ, Ordering Cost, Holding Cost, and Lot-Sizing Trade- offs.
NEW QUESTION # 68
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