LSC802: Assessment 3
Network Design Report
Weighting: 50%
In this assessment you are presented with a fictitious scenario. Based upon the details of
the scenario, the assumptions you make and personal research, you will design a supply
chain network for a New Zealand company that will optimise transportation costs and
customer service levels, and minimise waste and carbon emissions. Role playing as a
supply chain consultant, you will write a report in which you will explain and recommend
your supply chain design to the CEO of the company.
Scenario
Proctor-Thorsen International Limited (PTIL, known as Pee-Til) is a very successful New
Zealand manufacturer of high quality possum fur booties for adults and babies. Designed
for indoor use, the booties sell well in New Zealand (NZ) to both locals and tourists, and the
company has stable markets overseas, specifically Australia, North America (USA and
Canada), and Europe. Representative images of the PTIL product line can be found at the
end of this document.
PTIL’s manufacturing facility is based in Masterton. Currently PTIL receives all its possum
fur skins from Warm Wearer (WW), which is a tannery specialising in possum fur skins.
WW is based in Woodville and is managed by Iva B. Eard. WW has the capacity and
supply resource to produce up to 200,000 skins per year, where one skin is required for
each adult bootie or a pair of baby booties. WW’s dispatch policy is to courier orders within
10 days of ordering, unless otherwise discussed with the customer.
WW receives all its skins from hunters and trappers and, because possums are considered
to be a pest in New Zealand, there is no legal limit. Skins suitable for booties are harvested
during the period Jun – Aug, since the possum pelt is thickest during the NZ winter.
National demand information for PTIL booties is as follows:
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LSCM802 Assessment 3

International demand information is as follows:

The average retail price for a pair of booties is as follows: adult $NZ170, and baby $NZ60,
with similar prices being fetched overseas, after exchange rate conversion. All sales are
through independent retail stores whose customers tend to be affluent locals and tourists.
PTIL produces all its product at its Masterton facility and it values its loyal staff, many of
whom have been with the company since the start. Currently excess product is stored at
the manufacturing facility, including 15% buffer stock (15% of average annual demand), but
if PTIL wishes to expand its production, then that will have to be at the expense of storage
space. Therefore, it is important to find ways to safely reduce buffer stock.
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LSCM802 Assessment 3
PTIL is flexible with regard to packaging. The company is able to pack product in a range
of package sizes and will consider any package size that will help to optimise costs.
While PTIL is successful and has an established supply chain, the new owner and
managing director, Saraya Proctor-Thorsen, believes that it is old-fashioned because, other
than recently introducing a basic spreadsheet-level accounting and product/customer
management system, things have not changed much since her father started the business
20 years ago. She is keen to introduce supply chain best practice to PTIL, in particular to
optimise transportation costs and customer service levels. She is also enthusiastic about
sustainable practice so she wants to explore ways to minimise waste and carbon emissions
throughout her supply chain.
You are a supply chain consultant and PTIL has employed you to, in effect, design a supply
chain network that will achieve Saraya’s objectives. She does not want you to be guided by
PTIL’s existing process, but whatever you recommend must take account of the fact that
PTIL is a medium-sized company with a limited budget.
Scenario Assumption
1. There is no intention by PTIL to invest in transportation equipment, so there is no need
to consider the cost of investing in trucks, aircraft, rail cars, or ships. PTIL uses third
party carriers only;
2. Manufacturing will remain at Masterton in the foreseeable future;
3. PTIL has existing contracts with retailers and so at this stage, has no intention of
entering the on-line retail business; and
4. PTIL is responsible for getting its product to the international port of entry overseas, and
that the international purchaser will take care of the freight once the product has cleared
customs.
Assignment details are overleaf.
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LSCM802 Assessment 3
Your Assignment
Taking the scenario above, you are to design a supply chain network for
Proctor-Thorsen International that optimises transportation costs and
customer service levels, and minimises waste and carbon emissions.
You are to present your analysis and design recommendation in the form
of a report.
The design recommendation is to be based upon research and analysis
of all applicable and appropriate modes of transport taking account of the
locations provided above. This means that you are to analyse and
present options in detail, and recommend the preferred option. As far as
possible, you are to evaluate the typical trade-offs associated with cost of
transport & inventory, customer responsiveness, and consider innovative
methods of reducing costs, plus the environmental impact in terms of
waste and carbon emissions.
The total submission should comprise 3600 words (+/-10%, not including
calculations, appendices, citations and references).
Research. You are to actively research current costs, but you are also to
justify and explain assumptions and support these by referring to up-todate theory (this is achieved by exploring and using research literature).
Links to research literature are provided in the course/programme
resource section and also by searching using the Google Scholar search
engine. No matter the source, you are to document your research,
including contacts, emails, etc.
Finally, APA referencing guidelines are to be followed and evidence of
wide reading is expected for an assignment at this level, i.e. a minimum
of six authoritative sources to be acceptable, including the textbook. For
more information, please refer to the table on pg. 4 below and to the
‘Marking rubric’ on Moodle.
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LSCM802 Assessment 3
Learning Outcomes Covered by Assessment 2,
This assessment covers Learning Outcome 1 (in part) and the bulk of Learning Outcome 2.
The table below is designed to assist you by providing focus on the learning objectives to
be addressed within the LO.

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LSCM802 Assessment 3
Possum Fur Booties
The images below are of products manufactured by Envirofur Ltd (Taranaki NZ) and
Heirloom Weavers (NZ) Ltd respectively and are used to represent the general type, size,
and shape of the fictional baby and adult bootie product used for this assessment.
Baby Booties:
Image source: http://envirofur.co.nz/product-category/footwear/
Adult Booties:
Image source: https://www.heirloomweaversnz.com/-possum-boots—slippers.html