The UPS’s Christmas Eve Snafu is an example of what could result from poor logistics management. The 107 year old courier company failed to handle the situation with its vast resources. Several factors contributed to this failure of UPS: The last minute holiday sale by the retailers is what the analysts believe that lead to the unexpected glut of packages. Most of the retailers preferred air networks of the company to ground delivery to get gifts to customers on time. The discount sales and one-day delivery promises made by the retailers are just the beginning, from the courier company’s side, it failed to forecast the raise in its shipping volumes for the holiday.
-Initially the problem was supposed to be the under-performance of vendors who didn’t commit themselves to the process. The problem was supposed to be the order fulfilling rate of Foster but later on it was revealed that Avion was the root cause of problems. The Materials department had given Foster orders for only 2500 units and the lead time was supposed to be 14 days. But later on, as seen in the case, the Production Department needed the supply in 10 days. Moreover, the Marketing Department had to cater to a demand of 4000 whereas the order was for 2500 only.
Manufacturing costs for USS were high due to their lack of investments in new technologies. Their revenues, market share, and work force continued to decrease dramatically through the 1980’s. A large reason for USS’s decline was the introduction of the minimill steel manufacture to the industry. These minimills used 100% scrap for their raw material. When they entered the industry, they produced products that required less quality like concrete reinforcing bars.
In 2011 international locations accounted for 25% of sales, since then sales have dropped 22%. International expansion places increased demand on operational, managerial and administrative resources at all levels. ANF started opening huge stores all over Europe and other locations, even though demands in those areas were uncertain. ANF did not fully understand that nature of the international audience. Many of their products are inspired by East Coast tradition which is a slowing trend in international markets because as more and more locations appear, the weaker the trend gets.
What Disney failed to consider in this travel factor was the national holidays and the traditional breaks that Europeans have throughout the year. Instead of heavily marketing those time periods, Disney spent more time looking at American’s travel periods which are definitely different in Europe. A difference is that European shops close down around 12:30, usually for 1-2 hours. Disney failed to recognize this difference which led to a huge loss in their food revenue department. A second difference is that Europeans incorporate more alcohol into their culture more than Americans do.
Within a week’s span, the effects of the storm caused JetBlue to cancel more than one thousand flights and incur tens of millions of dollars in losses. The company had quickly come to the realization of multiple internal operational issues that compounded the crisis. First off, they had inadequate communication protocols to direct the company’s pilots and flight attendants of where and when to go anywhere. Secondly, they had an overwhelmed reservation system reporting inaccurate flight status and information. Lastly, they lacked employees that were cross-trained and could work outside their primary area of expertise which prevented critical emergency response efforts.
List Objectives for the PR Campaign In order to explain its operations into the overseas market, JetBlue Airlines had to overcome a few stumbling blocks that occurred earlier this year. One major stumbling block occurred when JetBlue cancelled hundreds of flights due to icy conditions and a black log of stranded passengers and flight crews. Jenny Dervin, JetBlue Airlines company spokesman said a decision by JetBlue’s hub, Networks’ John F. Kennedy International Airport, to limit all airlines to two runways was a major stumbling block in the company’s efforts to get back on track. (JetBlue weather woes not yet overcome, CNN.com) David Neelman, Founder and CEO of JetBlue, repeatedly apologized for the wave of cancellations and delays and said, “I think the best thing we can do is say we’re sorry and give them their money back, and give them a free ticket and then kind of plead with them to come and fly again.” Once a passenger has a bad experience with any airline, that passenger will think twice before booking another flight with the same airline. JetBlue needed to devise a new public relations campaign to regain those customers who lost confidence in the flight service and to attract new customers who may be interested in using the new overseas services.
The case show us that during 2013, some stores regularly ran out of stock of key items this could have got AAB negative publicity which . This situation has been followed with incomplete orders being sent to have many of the AAB outlets. “At least half of AAB's store managers complained about receiving large sizes and a new range of baby grows in only small and extra-large sizes” says Nick Fosten-AAB's Retail stores UK Director Stock management should be very import for AAB to sort out because stock out situations can be very costly for a business, for AAB this could be lost revenue this will ultimately decrease profit and could have been part of why AAB made a loss in 2013.AAB operates in a competitive market which means that if AAB can’t supply a product a customer will be able to get the product for another retailer, this will also cause AAB to loss revenue and ultimately profit. Another cost of stock out or incorrect orders is , negative publicity this can have a damaging effect on sales by encouraging AAB’s customers to shop at their competitors. The lost revenue will have an effect on profit and AAB’s ability to manage its stock well.
However, The Chevy volts relative market share is only 5.24 %, therefore its pre-tax profit compared to its 3 main competitors is well below average. The calculations of the Volt’s pre-tax profits are illustrated in Appendix II. * The sales of the Chevrolet Volt since it was first launched in 2010 are very volatile and they show the struggles that the Volt went through in its first year of being on the market. For example from January to February, sales decreased by 12 percent but then in March they suddenly increased by 116%. Also, in June there was a drastic decrease in sales of 78% due to the Volt catching fire during a test drive.
This problem was mainly due to poor transportation infrastructure or requirement for inter-distribution center movement. * High rate of products return. Distribution centers received six to eight truck loads each week of products returned from stores due to obsolescence, slow sales or quality problems. * High-in stock rate. Based on Wal-mart internal data, company’s in-stock rate was in the high 90s, which was significantly higher than the industry average of 90% in 2003.