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PROBLEM STATEMENT:
In present scenario Luxmi transformer is facing decision for having following criteria:
Modal Mix for Inbound Supplies
For Lump Ore (Daitari, Banspani, Goa)
For Pellets (Mangalore)
Modal Mix for Outbound supplies (DRI to Markets), which market to cater
Cheapest alternatives in terms of Transportation, Inventory holding, extra handling charges, and Stockyard for finished product to cater eastern region demand
Decision regarding Investment in Rail line Extension from Pen to Alibagh
Barge deployment according to Ship Size
Apart from these decisions they have to look into:
Target Market Share (which region to cater how much)
Use of Rail / Road Transportation for Near Market
Availability of Trucks for Loading at PEN
Shipping Cost advantage, with consideration that it's going to increase in future due to surge in shipping charges
Use of Ship for delivering DRI (Finished goods) at Eastern Markets
Some Consideration:
We are not aware of market share which we could capture. So instead of optimising demand with respect to capturing entire market in nearest region, we focussed on having policy to serve near by market (less than 900 kms) by 50% of demand & 25% market share in rest of the regions.
INBOUND MODAL MIX DECISION:
As per calculated figure for Lump Ore requirement (annual) for Luxmi transformer is 155000 tons, which wil ...