The hog problem case study

The Hog Problem: Integrated Logistic Executive Summary The hog slaughtering plant located in Brandon, Manitoba has the capacity to slaughter 2. 5 million hogs per year, around 50, 000 per week and 10, 000 per day. Hogs arrive at the slaughter plant from all over Manitoba and certain parts of Saskatchewan Vela truck. Every farm Is located wealth a different distance from the slaughter faculty and delivery lead times vary from as low as half an hour to as high as three and a half hours. Farms vary in size, which impacts the lot sizes for each respective farm.

This variation in size subsequently affects the loading/unloading mime span, which vary from one and half hour to four and half hours. The number of farms does not necessary pose a logistics problem for the plant’s Logistics Manager. Through careful analysis, the main issues for the slaughtering plant have been identified as fleet routing and scheduling. Due to a variation of lead times over the year, the plant struggles with the task of determining optimum fleet size and composition. The problem basically consists of finding the optimum set of routes that represent the lowest possible total cost and/or total travel time.

The plant is dealing with the repositioning of trucks to serve its supply demand and determining a number of transportation units that optimally balance supply requirements against the cost of maintaining the transportation units. In order to increase truck utilization the scheduling of a steady supply of hogs. These strategic logistical problems are symptoms of the following underlining complex issues faced by the plant. Time Constraints Nature: Strategic Timing: Short Term and Long Time The slaughtering operation at the plant runs from am to pm.

Live hogs are received between am and midnight. There are also restrictions on pick-up times.

In addition, loading operations at the suppliers’ premises run from AAA. M. To 9 p. M. This has implications for the number of pens, and the way inventory is managed on a daily basis.

Truck Utilization One load of hogs has to be transported from its pick-up location (farms) to its delivery location (plant). From the plant a truck is sent empty to its next farm destination. A truck visits only one farm on any given trip. When a truck arrives at a location early, loader becomes available.

These waiting times severely delay trucks and thus increase the cost of transportation and extend the lead times. Moreover, the trucks inefficient utilization have negative affects on the fixed cost of owned vehicles.

Dependency on Farmers Delivery Nature: Tactical Timing: Short Term Approximately 25% of the shipments to the plant arrive in farmer-owned trucks. These shipments vary in size from 50 to 200 hogs. The farmer’s scheduled delivery affects the overall hogs supply, and the plant is heavily dependent on the farmers schedule accuracy.

Lead Time Fluctuation Lead time varies significantly, which affects the inventory cycle. The plant has to set a feet stock that will protect the production against stock outs, vehicle breakdowns, weather related delays and the shortage of supply from farmers and hogs barns.