Case Questions

Dalia Card Imperium

Dalia Card Imperium (DCI) of Toronto, Ontario, is a distributor of basketball cards to sports card retailers. Its market area encompasses most of Ontario, eastern Manitoba, and southern Quebec. The cards are printed in Vancouver, BC, and currently shipped to Toronto via motor carrier transportation. Dalia Hernandez, vice president of logistics, has asked her staff to evaluate using air carrier service to ship the cards. San Perera, director of distribution, has collected the following information:

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  • Annual demand: 7,200 cases of cards
  • Value (price): $101 per case
  • Unit weight: 25Kg per case
  • Inventory carrying cost (annual): 29% of the annual inventory value
  • Ordering cost to replenish inventory: $79 per order
  • In-transit inventory carrying cost (annual): 19% of the annual inventory value
  • Motor carrier rate: $1.20 per 50Kg
  • Transit time using motor carrier (parcel ground): 7 days
  • Cycle time using motor carrier (parcel ground): 10 days
  • Air carrier rate: $2.50 per 50Kg
  • Transit time using air carrier: 2 day
  • Cycle time using air carrier: 3 days

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