Case Study Analysis

Practical Exercise -

The Manager of Network Support at MBUSA has asked you to issue a transport tender to four Vendors for transport services for 68 Dealers in the Chicago Area.

The service you requested is Dealer Direct Service (DDS) and you requested all Vendors to bid on all 68 Dealers for a three year period.

You advised Vendors to assume a fuel price of $3.50 per gallon, fuel is charged separately and in addition to the cost per mile.

You requested the Vendors to provide you with the following information:

· The total number of routes required in order to complete the deliveries to all 68 Dealers

· The number and mix of trailers that would be required to complete the deliveries to all 68 Dealers

· Their Driver turnover, attendance and accident rate

· The annual number of miles that would be driven to complete their proposed delivery routes and the cost per mile that MBUSA would be charged for the service

· Any startup costs that the Vendor would charge MBUSA for the setup of the service

On the attached sheet you will find the Vendor submissions with the data requested, analyze the Vendor submissions and calculate the following information:

· The total annual cost to MBUSA based on the miles and cost per mile

· The total fuel cost assuming a cost of 6.25mpg

· The total costs in year 1, 2 and 3

· Make a recommendation, based on the available information, on the best Vendor to award the contract to

Prepare a 15 minute presentation and in no more than 5 slides describe the following:

· The major challenges facing the Automotive Industry in the USA in 2011

· The major challenges facing MBUSA’s Parts Business in 2011

· The summary of the analysis of the Vendor submissions and the results of your calculations

· Your recommendation, based on the available information, on the best Vendor to award the contract to. Please include the rationale for your recommendation and the potential cost saving from MBUSA based on the current contract cost.