Components in Shanghai Region to Consolidation Point: By truck from individual suppliers direct (no 3rd party service supplier needed to transport)

        It is important for the company to realize the fact that products should reach their consolidation point with fewer costs as much as possible, so that they can reach at their final destination. If products will cost too much to reach to their consolidation point, then price the product will be increased to cover all costs and expenses occurring in the supply chain. The other important to keep in mind is that when global supply chain is managed, then cost is the most relevant item to look at, because higher costs will be shifted to customers, and they may look for cheaper products from other companies. So, a service supplier is always a viable option to do so in this regard. The company is making different components in Shanghai region, which needs to be shifted to consolidation point, so here are few products to be mentioned from the Shanghai region, which are directly sent from individual suppliers through trucks, as trucks have more capacity to load more products at a time:

a)   Alligator clips, Changzhou, $10.00

b)   Amplifier, Ningbo, $271.00

c)   Battery wire, Jiangyin, $68.00

d)   Butt connectors, PingHu, $10.00

e)    Pallets, Qingdao, $122.00

f)    Speakers, Taixing, $537.00

g)    Rubberbands, Xiamen, $10.00

It is quite evident that few components costs are less than the other components. It is because few consolidation points are far away from individual suppliers, and few points are nearby with less cost to bear.

2. Components from Consolidation Point to Assembly Point in Shenzhen:

  The assembly point for the company is Shenzhen, and now all of above-mentioned components needs to reach the assembly point. Following costs have been measured to do so:

·         DHL, 40ft container (TL), truck, 3 days, $4,896.87

It means that via truck, all components will reach their assembly point in three days and total cost will be $4,896.87. The company needs to look at this cost, and find any possible alternative

3. Plastic Moldings from Mumbai to Assembly Point in Shenzhen:

·         iContainers, 20ft container, ocean freight, 7-10 days, $500

It is interesting to see that a global supply coming from India to Shenzhen is costing less because ocean freight is used, but supply days are more than any other service.