Case Study Caselet Prime Plastics Pvt. Ltd. is a company based out of Mumbai, India. They produce vials using LDPE (Low Density Polyethylene) granules

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 Supply Chain Managementinfo_at_answersheets.in
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•  Supply Chain Management
• 1. A group of NMIMS alumni have started a new
  e-commerce company and they are expecting to
  serve only 5 cities- Delhi, Mumbai, Bangalore,
  Kolkata and Hyderabad. Each parcel they ship to
  their customers in these cities weighs between
  200 grams and 400 grams. They negotiated with a
  courier company for shipping their parcels and
  the best rates they got for all parcels up to 0.5
  kg are given in below table

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• For processing their orders and storing the
  inventory, they need a 10000 sq ft warehouse. The
  rental cost in Mumbai is Rs. 20 per sqft. whereas
  the rent in Delhi is Rs. 8.5 per sqft. All other
  costs of operating the warehouse is same for both
  the cities. The group has to decide if they
  should have a warehouse in Delhi or in Mumbai to
  keep their costs to minimum. (10 Marks)

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• Q 2. Case Study/ Caselet Prime Plastics Pvt. Ltd.
  is a company based out of Mumbai, India. They
  produce vials using LDPE (Low Density
  Polyethylene) granules. Granules are imported
  from a plant in Germany which dispatches the
  goods on the same day when order is received. The
  shipments are made through sea and the
  transportation lead time is 45 days. Once the
  granules are received, the company tests the
  goods in their inhouse lab and only after that,
  the granules are used for making vials. Testing
  time for granules is 15 days. On an average
  company uses 24 metric tons of granules every
  month. However the business development team of
  the company has informed that any day they can
  receive new orders and the consumption of
  granules can go up to 30 metric tons.

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• a.) How much safety stock of granules should the
  company maintain (5 Marks)
• b.) At what inventory level the order for new lot
  of granules should be placed. (5 Marks)

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