Case 1.2
Central Transport,
Inc.
Subject: Supply Chain Management
Lecturer: Pham Thi Trang, Ph.D
Class: B06E
Group:
MEMBER
01
Trần Hồng Phương
03
Nguyễn Phương
Thảo
05
Trần Thị Thuỳ
Tiên
02
Dư Hữu Tỷ
04
Mai Ngọc Thanh
Thảo
Table of contents
01
Abbriviation
02
Case Questions
Part 1
ABBRIVIATION
1. Overview
2. Susan’s plan
4. Proposal
3. Approach to Wegman's
1. Overview
Jamie Corman, the new
president and CEO of Central
Transport, met with Susan
Weber, the current president
and CEO of SAB Distribution.
Susan’s predecessor had
collaborated with the former
CEO of SAB Distribution in
transforming the company’s
operations a decade ago.
Jamie was promoted from
CM at Central Transport
to CEO.
Susan now faced new
challenges and sought
collaboration from Jamie and
Central Transport.
2. Susan’s plan
Susan extensively
met with her
executive team
to develop a
tentative plan for
modifying SAB's
strategic
direction and
preventing a
buyout by a
private
investment firm.
Susan believed that
improving SAB’s
logistics services,
including
warehousing,
transportation
delivery, and
inventory
management, could
attract additional
retailers in the midAtlantic states.
She felt the need
for a major
collaborator
with experience
in these areas.
Susan preferred a
collaborator that
SAB had worked
successfully before
and was willing to
take on new
challenges.
3. Approach to Wegman's
Susan decided to approach
Wegman's Food Markets, Inc. as a
potential customer for SAB's new
services.
Wegman's was a successful privatelyowned company in the Northeast,
offering value-added services like an
in-store bakery, restaurant and deli,
take-out options, and in-store cooking
demonstrations.
Wegman’s primary distribution
point was in Rochester, New York,
but they were developing a new
distribution park in northwestern
Pennsylvania for their expansion
into the Washington, D.C. area and
further south into Virginia.
Wegman’s faced pressure to be
price competitive while
maintaining their unique instore services.
4. Proposal
Susan believed
Wegman's could be
price competitive and
expand its market
opportunities.
She wanted Central
Transport to
collaborate with SAB
in presenting a
proposal to
Wegman's.
Jamie sought
help in
formulating a
response to
Susan’s request.
Part 2
Case Questions
1.
2.
3.
Why and how has the competitive market place
for SAB changed in the last five to seven years?
What advantages might Central experience in
the proposed new venture?
What issues would SAB and Central face in the
proposed new approach?
1. Why and how has the competitive market place for SAB
changed in the last five to seven years?
- Retail giants like Wal-Mart exert pressure on distributors like SAB by purchasing directly from
manufacturers, reducing expenses.
- Key external factors encompass globalization, technology, organizational consolidation,
empowered consumers, and government policies.
Elaboration:
- Globalization created economic uncertainty by affecting product demand and supply.
- Organizational consolidation increased demand and control.
- Small and medium-scale organizations faced challenges in adopting suitable technology for
supply chain management.
- Empowered consumers sought quality products, leading to increased access to product
information.
- Government policies impacted organizational aspects such as communication, finances, and
transportation.
2. What advantages might Central experience in
the proposed new venture?
- SAB's desire to increase its transportation base and customer
services means that Central will likely receive additional business.
Elaboration:
• It could fascinate more retailers which in turn will improve
warehousing and inventory management.
• Employability will increase along with expansion of business
in different areas.
• Cost can be controlled or get lowered and be price
competitive in the market.
• Expansion of market opportunities.
3. What issues would SAB and Central face in
the proposed new approach?
SAB faces the dilemma of potentially deterring cost-conscious customers by adding services.
Meanwhile, Central grapples with "growing pains" caused by challenges like driver shortages,
increased fuel costs, and evolving driver hour regulations.
Elaboration:
- Challenges in hiring qualified professionals may cause delays.
- Implementing the right technology poses a significant challenge.
- Ensuring secure data gathering and storage requires careful attention.
- Managing costs or pricing effectively may prove difficult.
- Meeting legal formalities can become an issue.
- Maintaining consistent communication pace may be challenging.
- Fluctuations in management may occur due to the bullwhip effect.
Thank you for
listening