Grocery Gateway Alternatives

Problem Statements

Dominique Van Voorhis, Vice President of Industrial Engineering and Operations has found through the analysis of reports there is a deficiency in the delivery operations at their Downsview centre. The Company objective is targeting four stops per hour for drivers and they are currently averaging 2.7 stops. Dominique is required to present recommendations to improve the performance of delivery operations at the next management meeting, which takes place in seven days.

Alternatives

The following alternatives for improving delivery operations were evaluated in detail:

1 – Keep the trucks on the road longer by extending driver shifts

In this alternative the delivery trucks would be kept on the road longer and the drivers shifts would be extended. Although this may not assist in increasing the number of stops per hour, this would allow for additional deliveries to be completed in a day thereby meeting the company objective of increasing profits. This alternative will also assist the company in meeting its growth target of 5,000 orders per day over the next three years.

In order to accomplish this a plan would have to be implemented to replenish the trucks; the RIMMS system could be utilized for this. The company would also have to ensure that the high quality of service that is currently being provided to the consumers is still being met. The company could also look at completing consumer surveys to ensure the quality of service is still at par.

Pros:

* May allow more optimized routes

* Would fill more customer orders / day

* Increased profits and market share

Cons:

* Would require a plan to replenish trucks which may be at an increased cost

* Increased cost for salary ($30 per hour for vehicle and driver)

* Service may be impacted

2 – Increase Delivery Charge

Another option for Grocery Gateway would be to increase the delivery charges to the customers. The current deliver cost is $8; an...