CMS: …………………….

Riphah International University

+ Faculty of Management Sciences
Riphah School of Leadership
Final Term Examinations, Fall 2020

Subject: Supply Chain Management Teacher Name: Syed Waqar Akbar

Marks: 40 (weightage 20%) Time Allowed: As per university policy
Instructions: Attempt all questions.

Q1: (7 Marks)
Develop the strategic plan of organization focused in case study Highly confident transportation using following
analysis, your answer must cover the following aspects:
i. PESTEL Analysis
ii. SWOT analysis
iii. Porter’s five forces model
iv. Corner stones of current strategy
v. Issues/areas to be covered based on output of above three analysis
vi. Future strategy based, its benefits and expected limitations.

Q2: (7 Marks)
Briefly define / discuss following:
i. Procedure of for preparation of Supply position model
ii. Procedure for preparation of Supplier selection model
iii. Use and importance of TCO model in supply chain
iv. List down the contemporary practices in supply chain, also indicate the practices which are most
adopted by organization in Pakistan

Q3: (7 Marks)
(a) Discuss the role of inco-terms in logistics. Discuss once term for each category with cost and risk implications
for both buyers and sellers?

(b) Differentiate between 3PL and 4PL model. Discuss how these models are in practice in Pakistani environment,
give practical examples, if any?

(b) You are in process of buying vehicles for large scale movement of items from Islamabad to Lahore on regular
basis. You have fowling options with details:

Pay load
Vehicles Cost life Km per year Consumption Km/ltr
(in tonnes)
Rigid body truck 600,000 30 10years 100,000 100 Km in 10 ltr
Articulated truck 900,000 60 10 years 100,000 50 Km in 10 ltr
 Calculate unit depreciation cost, interpret the result and decide which one is better
 Load carried yearly per cost of one driver, interpret the result and decide which one is better
 Load carried per cost of one liter, interpret the result and decide which one is better
Page 1 of 3
Q4: (7 Marks)
(a) Discuss the treatment of fixed cost in various components of EOQ model, (Refer to the case study 3Js) what
mistakes are made in estimation of EOQ, discuss by giving examples / references from the case study ?

(a) WXY, Inc., would like to determine the safety stock to maintain for a product, so that the lowest combination
of stock out cost and carrying cost would result. The following probabilities of running out of stock during an order
period are associated with various safety stock levels:

Stock out units PROBABILITY STOCK OUT

1000 30%
2000 20
4000 40
8000 10

From the following data calculate:

i. Expected stock out
ii. Expected variation in expected stock out
iii. What are the various options available for maintaining safety stock if you are conservative, aggressive or
rational inventory manager?
iv. If unit cost is Rs. 100, what will be the investment involved in options estimated in s.no iii above
v. If Carrying cost is 10% than estimate the associated with each of above options?
vi. Discuss with justifications your decision

Q5: (7Marks)
After following the evaluation procedure, supplier A is shortlisted for procurement of complete installation system
of the factory. Supplier has quoted the cost of project as per following:

Cost of system 1,000,000

Transportation 30,000
Installation cost 20,000
Insurance 20,000

The salvage value is 300,000 for above system. Company has estimated the expected costs based on study of
technical specification of the project. Company will obtain funds at 10%, straight line method of depreciation is
used. Relevant information is as under:
Year 1 2 3 4
Cost
Raw material usage 80000 90000 100000 150000
Electricity 10000 30000 40000 50000
POL 15000 20000 25000 30000
Salary expense 35000 45000 60000 65000
Rent expense 30000 30000 30000 30000
Taxes 30%

Working capital in year 0 is Rs. 50,000 which will increase by 10000every from year 1 to 4. Calculate the total
cost of ownership of the equipment.

Page 2 of 3
Q6: (5 Marks)
Answer the following questions in light of case study warehousing at Volkswagen VCGA
i. What is the state of the automotive industry at the time of this case?
ii. What value does the Toronto PDC provide to dealerships?
iii. What does a typical parts warehouse look like?
iv. What is the typical flow of parts from production to the customer?
v. What are the critical success factors in running the automotive parts distribution center?
vi. How many small and large bins are in warehouse and how many are being used?
vii. How many new parts will be added each year from new product launches and facelifts?
viii. How many total bins are required each year for next five years?
ix. Considering empty bins available at the moment, how many net new binds are required?
x. How many additional cubic feet of warehouse space will be required?
xi. How many cubic feet of space are in current warehouse?
xii. How many cubic feet of space will be available in new expanded warehouse?
xiii. What are the different options available for expansion, discuss pros and cons of each?
xiv. Which option is financially and operationally feasible, discuss with your arguments?
xv. If you were Kym and sales were not to follow through, what would you do?

Page 3 of 3