Description

LOG360

Solutions Design for Logistics and Supply

Chain Management

Group-based Assignment

July 2023 Presentation

LOG360 Group-based Assignment

SINGAPORE UNIVERSITY OF SOCIAL SCIENCES (SUSS) Page 2 of 11
GROUP-BASED ASSIGNMENT
This assignment is worth 20% of the final mark for LOG360 Solutions Design for Logistics
and Supply Chain Management.
The cut-off date for this assignment is 13 October 2023, 2355 hours.
This is a group-based assignment. You should form a group of 4 members from your seminar
group. Each group is required to upload a single report via your respective seminar group site
in Canvas. Please elect a group leader. The responsibility of the group leader is to upload the
report on behalf of the group.
It is important for each group member to contribute substantially to the final submitted work.
All group members are equally responsible for the entire submitted assignment. If you feel that
the work distribution is inequitable to either yourself or your group mates, please highlight this
to your instructor as soon as possible. Your instructor will then investigate and decide on any
action that needs to be taken. It is not necessary for all group members to be awarded the same
mark.

Note to Students:
Compose your report using Microsoft Office Word, and save either as .doc or .docx
(preferred).
You are to include the following particulars in your submission: Course Code, Title of the
GBA, SUSS PI No., Your Name, and Submission Date.

Use of Generative AI Tools (Allowed)
The use of generative AI tools is allowed for this assignment.
• You are expected to provide proper attribution if you use generative AI tools while
completing the assignment, including appropriate and discipline-specific citation, a
table detailing the name of the AI tool used, the approach to using the tool (e.g. what
prompts were used), the full output provided by the tool, and which part of the output
was adapted for the assignment;
• To take note of section 3, paragraph 3.2 and section 5.2, paragraph 2A.1 (Viva Voce)
of the Student Handbook;
• The University has the right to exercise the viva voce option to determine the authorship
of a student’s submission should there be reasonable grounds to suspect that the
submission may not be fully the student’s own work.
• For more details on academic integrity and guidance on responsible use of generative
AI tools in assignments, please refer to the TLC website for more details;

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SINGAPORE UNIVERSITY OF SOCIAL SCIENCES (SUSS) Page 3 of 11
• The University will continue to review the use of generative AI tools based on feedback
and in light of developments in AI and related technologies.

Important Note: Grading of GBA Submissions
Marks awarded to your assignment are based on the following guidelines:
Component Description Marks
1. Content • Demonstrates good understanding of concepts; identifies key
points correctly and comprehensively; applies relevant
knowledge to solve the problem or address the issue
• Provides supporting reasons drawn from course materials and
other credible sources, wherever relevant
• Shows a good grasp of the problem/issue with critical insight
• Provides a mature response with feasible recommendations
80

2. Quality of
Writing

• Demonstrates highly original writing*
• Constructs sentences that are grammatically and syntactically
correct, and are free from spelling mistakes
• Appropriate use of specialised vocabulary and terminology
related to the subject matter, wherever relevant
• Provides proper in-text citation and referencing to content
drawn from course materials and other credible sources that
follow APA formatting and style guidelines**

10

3. Quality of
Presentation

• Presents key points, workings, numerical formulations and
results in a clear, logical and succinct manner
• Presents well-annotated tables and figures, wherever
relevant, that follow APA formatting and style guidelines**
• Provides a reference list at the end of the main report
• Shows proper formatting in:
o cover page, main text, tables, figures, references,
appendices (if necessary), the numbering of pages
o adherence to the specified word count, where applicable
10

Total 100

Notes:
* Reports with high Turnitin similarity percentage, especially when the matching content is
not cited and referenced, can attract further penalties.
** See https://apastyle.apa.org/style-grammar-guidelines for tutorials and webinars on the
APA formatting and style guidelines. See also Purdue University’s Online Writing Lab
https://owl.purdue.edu/ for information on APA formatting and style guide.

LOG360 Group-based Assignment

SINGAPORE UNIVERSITY OF SOCIAL SCIENCES (SUSS) Page 4 of 11
A BUILD-TO-SUIT GROCERY DISTRIBUTION CENTRE
CP Mart, a grocery retailer, operates a network of supermarkets and hypermarkets in
Singapore. The company imports a diverse range of food and household products, which are
consolidated at a distribution centre (DC) before being despatched to individual stores.
Additionally, the DC serves as a warehouse (among others) for Singapore’s strategic stockpile
of essential food items such as rice and poultry.
To support its expanding business, CP Mart anticipates the need for a new build-to-suit (BTS)
DC in the next few years. This involves partnering with an industrial real estate
developer/investor who will construct a custom-designed DC based on CP Mart’s
specifications. In return, CP Mart will commit to a 10-year lease agreement with the developer.
However, before approaching the developer, CP Mart must establish its requirements and
develop a desired layout plan for the new DC.
Your team has been engaged as logistics consultants by CP Mart to provide recommendations
on the capacity of the proposed DC and its basic internal layout. Based on your design, CP

Mart will determine whether to operate the DC in-house or outsource the operations to a third-
party logistics provider (3PL), depending on which option proves to be more cost-effective.

Therefore, CP Mart requires a benchmark estimation of the annual cost of fulfillment at the
proposed facility.
CP Mart has provided the following information to assist you with your work.

1. Product and Volume Profiles
The new DC will operate continuously, 24 hours a day, every day of the year. It will handle
three distinct product types: ambient, chilled, and frozen. For optimal storage conditions, the
ambient (dry) storage area must maintain a temperature range of 20-25°C, while the chilled
storage area requires temperatures between 0-5°C. The frozen storage zone must be
consistently kept at -18°C.
CP Mart has stipulated that all incoming products will be received and placed on shelves as
whole pallets, without any loose cartons. This means that all inbound pallets will each contain
only a single product and are thus often referred to as uniform pallets or mono-pallets.
The picking process within the DC will involve both full pallet picks and carton picks.
Approximately 90% of outbound ambient or chilled pallets will be uniform, while the
remaining 10% will be mixed. On the other hand, all outbound frozen pallets will be uniform.
Regarding the capacity of the new DC, CP Mart has not yet determined the exact number of
pallet positions required. However, they have provided essential information in Table 1, which
includes the maximum target throughput in cubic metres (CBM) over the DC’s operational
lifespan, as well as the average inventory turns that the facility will handle.

LOG360 Group-based Assignment

SINGAPORE UNIVERSITY OF SOCIAL SCIENCES (SUSS) Page 5 of 11
Table 1: Throughput, Inventory Turns, Dimensions and Density by Product Type
Product type Maximum
annual
throughput
(CBM)

Average
inventory
turns per
year
(times)

Pallet
dimensions
(LxWxH) in
metres

Carton
dimensions
(LxWxH) in
metres

Product
density
(kg/m3)

Ambient 360,000 20

1.2 x 1.0 x 1.2

0.4 x 0.25 x 0.3 700
Chilled 180,000 16 0.4 x 0.25 x 0.3 700
Frozen 72,000 8 0.3 x 0.25 x 0.3 600
2. Storage/Racking Parameters
To minimise cooling costs, CP Mart plans to implement very-narrow-aisles (VNA) exclusively
in the frozen storage zone. In contrast, the ambient and chilled zones will utilise regular width
aisles to prioritise productivity and safety.
To ensure convenient access within the DC, selective racking with single-deep pallets will be
employed. The racks should be constructed to be as tall as possible, maximising vertical
utilisation, and placed as close together as practical to minimise floor space usage. However,
operational limitations dictate that VNA racks may not exceed a height of 10 metres, while
wide-aisle racks will be limited to a maximum height of 8 metres, measured from the floor to
the base of the highest pallet location.
To align with the specifications provided by a racking vendor, the distance between vertical
supports in the VNA racks will be precisely 2.4 metres. In the wide-aisle racks, the distance
between vertical supports will be exactly 3.6 metres. This ensures consistency and
compatibility with the designated racking system.
To avoid gridlock and allow for temporary inventory spikes, the effective storage space
utilisation should not exceed 90% in the design. Moreover, the following allowances must be
adhered to:
• Safety clearances for aisles: 200 mm
• Clearances between racks and pallets in storage: 100 mm
• Rack beam heights and rack support widths: 100 mm
The physical racks and shelves cost $100 per pallet position to purchase and install. These can
be used for 10 years and may thus be amortised evenly over this period.
3. Facility Parameters
CP Mart prefers a rectangular or squarish floor plan at the distribution centre (DC). It should
have a minimum internal clear height of 12 metres, excluding any required clearances for water
sprinklers, aircon ducts, and lighting. For the sake of simplicity, a single-storey building can
be assumed, with dimensions determined based on the required storage capacity. Ancillary
zones like the office area, packaging area, returns processing area, and material handling
equipment (MHE) parking area are part of the overall facility but are not within the scope of
the current project.
To optimise storage density and facilitate efficient equipment movement, CP Mart requires that
the DC be designed with column/pillar spacing of no less than 12 metres.

LOG360 Group-based Assignment

SINGAPORE UNIVERSITY OF SOCIAL SCIENCES (SUSS) Page 6 of 11
To facilitate the receiving and distribution of goods, the DC must have a minimum of 20
loading docks, divided equally between inbound and outbound areas. The dock doors should
have a minimum centre-to-centre spacing of 3.6 metres. The layout should also include staging
areas capable of accommodating 100% of the floor space occupied by the daily throughput of
pallets.
For a logistics facility of such scale and specifications, the average long-term market leasing
rate is estimated at $10 per square metre per month for the next 10 years.
4. Material Handling Equipment, IT and Utilities
In the typical inbound process at CP Mart’s current DC, a forklift is responsible for unloading
pallets from trucks and transporting them to the end of an aisle. At that point, a reach truck
takes over and positions the pallets onto the racks. During outbound operations for uniform
pallets, the process is reversed.
However, to assemble mixed pallets, a picker operating a man-up picker truck is required. The
picker selects cartons from pallets that have been disassembled on pallet racks and places them
at the end of the aisle. These cartons are then transported by a labourer to the staging area using
a pallet jack. Alternatively, a forklift may be used for the transfer if a forklift driver is available
and not occupied with other tasks. In the staging area, the cartons are sorted and manually
reassembled into mixed pallets containing products of the same type (chilled or ambient).
Finally, forklifts load these mixed pallets onto trucks designated for each store.
To access the VNA racks, the process is similar, but CP Mart will utilise swing reach trucks
with a maximum lift height of 10 metres. These swing reach trucks operate along guide rails
and are unable to make turns within the aisles.
CP Mart plans to utilise its existing material handling equipment (MHE) supplier. The supplier
offers various models of electric MHEs available for lease, as outlined in Table 2.
Table 2: Material Handling Equipment Specifications
Order
Picker
Truck

Swing
Reach
Truck

Regular
Reach Truck

Forklift Pallet Jack

Turning radius 1.8m 0m*/1.7m** 1.7m 1.7m 0.5m
Fork length 0.9m 0.9m 0.9m 0.9m 0.9m
Maximum lift
height

8m 10m 8m 3m 0m
Length 1.9m 1.4m 2.2m 2.2m 1.4m
Width 1.3m 1.3m 1.3m 1.1m 1.1m
Load capacity 1,000kg 2,000kg 2,000kg 2,000kg 1,160kg
Leasing &
operating cost
per day

$50 $75 $75 $60 $10

* Along pick aisles ** Outside of pick aisles
When the MHEs are operated by trained workers equipped with IT tools like mobile scanners,
CP Mart can consistently achieve the following productivities at its current DC:

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SINGAPORE UNIVERSITY OF SOCIAL SCIENCES (SUSS) Page 7 of 11
• Average MHE operating speed: 2.1 metres per second
• Average worker’s walking speed with loaded pallet jack: 0.5 metre per second
• Putaway/picking of uniform pallet (floor to rack): 60 seconds per pallet
• Picking of carton (rack to floor): 45 seconds per carton
• Building a mixed pallet at the outbound staging area: 5 minutes
• Forklift productivity of loading or unloading between a truck and the staging area: 30
seconds per pallet
In terms of IT costs, an estimate of $0.50 per pallet move (or equivalent) should be allocated,
which includes the amortised cost of scanners and a warehouse management system.
Utilities, primarily electricity, account for a significant part of the overall costs. For the ambient
storage zone, the cost of utilities is fairly low, estimated at $8 per square metre per year.
However, for the chilled and frozen storage zones, the utilities cost is estimated at $15 and $30
per cubic metre per year respectively, based on the internal volume of the storage compartment.
5. Labour Costs
To facilitate the computation of fulfilment costs, CP Mart has provided the following
information regarding employee wages and relevant employment policies:
• A reach truck driver, capable of operating both regular and swing reach trucks, costs
$120 per day for an 8-hour shift.
• Employing a forklift driver costs $100 per day for an 8-hour shift.
• The cost of a picker, trained in operating a picker truck, is $80 per day for an 8-hour
shift.
• Manual labour workers involved in tasks such as transferring cartons, sorting,
palletisation, and packing, are paid $60 per day for an 8-hour shift.
• Salaries are stated based on an 8-hour working day and there are three shifts in a day.
• Employee absences due to sick leave or annual leave are already factored into the fully
loaded salary costs and hence can be neglected.
• A 20% productivity buffer should be applied in labour requirement calculations to
account for training and break times.
• Overtime is not typically adopted to ensure employee well-being due to fatigue and
safety considerations.
• Temporary hourly-rated workers may be employed for a few days before festive periods
or to cover for absences of full-time employees, but the costs associated with them can
be neglected.
• Overhead labour costs, such as those related to supervisors or site managers, can also
be neglected in the fulfillment cost calculations.
• The number of workers of each type should be rounded up; fractional headcount is not
permitted.

6. Scope, Report Format and Assumptions
You should answer the questions directly in your report, i.e., your answers do not have to be in
a formal consultancy or sales proposal addressed to the client.

LOG360 Group-based Assignment

SINGAPORE UNIVERSITY OF SOCIAL SCIENCES (SUSS) Page 8 of 11
For this assignment, the following topics are NOT in scope:
• Network or location optimisation
• Freight cost optimisation
• Truck/trailer allocation and scheduling
• Yard space design
• Space allocation and design for ancillary zones, such as offices, lifts and rest areas
• Workforce scheduling
• Sensitivity analysis
• Net present value (NPV) analysis
• Mezzanine design
• Heating, ventilation, and air conditioning (HVAC) design
• Health, safety and environment (HSE) design (e.g. sprinklers, guard rails, walking
paths, etc)
• Electrical power load design
• Performance metrics design
• Logistics sustainability
• Risk analysis
• Building construction and architectural costing
You should submit a logistics costing spreadsheet model based on the provided templates in
Table 3 and Table 4.

LOG360 Group-based Assignment

SINGAPORE UNIVERSITY OF SOCIAL SCIENCES (SUSS) Page 9 of 11

Table 3: Resource-Based Costing Template
Category Sub-category Hours Quantity Unit Cost
($)

Daily Cost
($)
Labour Picker truck operator $80/pax

Reach truck operator
(regular or swing)

$120/pax
Forklift operator $100/pax
Manual labour (Pallet
jack operator or pallet
builder)

$60/pax

Sub-Total

MHE Picker truck $50/MHE
Swing reach truck $90/MHE
Regular reach truck $75/MHE
Forklift $60/MHE
Pallet jack $10/MHE
Sub-Total

Others Facility leasing NA m2 $10/m2
/mth

Utilities
Ambient NA m2 $8/m2
/year
Chilled NA m3 $15/m3
/year
Frozen NA m3 $30/m3
/year

IT NA pallet
moves
$0.50/move

Racking NA pallet
position

$100/pallet
position

Sub-Total

Grand Total

Table 4: Activity-Based Costing Template

Cost per pallet ($) Ambient Chilled Frozen
Inbound processing
Outbound processing
Storage
Total
When creating the model, you may neglect cost inflations and any costs that are not stated.
Additionally, assumptions may be made as necessary for any information that has not been
provided. Hence, there may be a range of possible acceptable answers depending on the
assumptions made.

Question 1
CP Mart has asked you to determine the basic specifications for the distribution centre. Your
response should cover the following aspects:
• Space requirements in terms of pallet positions for each product type (ambient, chilled
and frozen).

LOG360 Group-based Assignment

SINGAPORE UNIVERSITY OF SOCIAL SCIENCES (SUSS) Page 10 of 11
• Recommended column spacing and aisle spacings for the pallet racks in each of the
product zones.
• Checks on required floor load and floor rating/class. The unladen weight of racks and
empty pallets may be neglected for floor load calculations.

(20 marks)

Question 2
CP Mart has requested that you recommend, using a spreadsheet, the number of resources
required and the associated costs of operating the DC. Your answer should:
• Calculate the number of resources required by type and hence the resource-based costs,
according to the format in Table 3.
• Determine the activity-based costs by product type, according to the format in Table 4.
• Discuss the major cost components and any other insights from your costing model.
(20 marks)

Question 3
Design the rack-and-aisle layout for the proposed facility for CP Mart, based on the parameters
provided in the question. Your design should include:
• Computations of the aisle length and hence footprint required for each of the three
product zones.
• A sketch of the locations of the three product zones (with dock doors and entrances), as
well as the rack-and-aisle layout in the facility. A scale drawing is preferred but not
essential. Some explanations should be provided, and excessive unused white space
should be avoided.

(20 marks)

Question 4
After you have completed the detailed design of your solution, CP Mart’s Head of Logistics
expresses concern about how the BTS facility can cope if volumes and wages are to rise
significantly in 5 years’ time. She would therefore like to know about other companies’
experiences in increasing logistics productivity via automation or otherwise.
Consider an organisation that you work for or are very familiar with. This organisation
should have adopted some form of logistics automation (e.g. conveyors or AS/RS) or logistics
technological solutions (e.g. RFID and RF scanners). Without showing any calculations or
workings, prepare a research note for CP Mart on the potential for incorporating automation at
the facility that you have selected. Demonstrate an understanding of throughput, capacity and
automation in logistics solutions by:

LOG360 Group-based Assignment

SINGAPORE UNIVERSITY OF SOCIAL SCIENCES (SUSS) Page 11 of 11
• Briefly introducing your selected organisation, the industry it operates in and its
logistics automation experience.
• Discussing how the considerations and parameters at the company that you have
selected are different from those at CP Mart’s facility.
• Examining how future throughput and capacity for CP Mart’s facility can be increased
via non-automation methods, but without having unused white space to grow into.
• Comparing any two (2) automation solutions in terms of their suitability in the facility
for CP Mart versus that for your selected organisation.

(20 marks)

—- END OF ASSIGNMENT