We did this case in our university 'Bangladesh University of Professionals (BUP)' in 6th semester under the course 'Supply Chain Management'.

1. Case Study:
GATEWAY
Presented By:
Ariq Rahman
ID: B1001024
Sabrina Farah Kaisar
ID: B1001026
Md. Mushfiq Alam Arko
ID: B1001027
Mohammad Daulat Al Rashid
ID: B1001039
Nisa Nur Majumder
ID: B1001046

2. Case Overview
GATEWAY:

3. Why Multiple Production
Facilities???
 Reach the local markets
 Increase production facilities to meet
the higher local demand
 Locate in low wage areas
 Near parts suppliers
 Avoid higher tax areas/states

4. Advantages of Increasing No
of Production Facilities
 Avoid production disruption due to
 Worker Agitation
 Supply Disruption

 Reach the local markets
 Increase production facilities to meet the
higher local demand
 Locate in low wage areas
 Near parts suppliers
 Avoid higher tax areas/states

5. Disadvantages of Increasing
No of Production Facilities

6. How Gateway decides which
production facility will produce
and ship a customer order
 Primaryobjective: Reduce overall cost
and increase maximum returns
 Whichever is near to the customer
 Whichever has less transportation cost
 Whichever has less response time
 Whichever can avoid taxation/Trade Barriers

7. Factors Considered When
Deciding Which Plant to Close
 Primary objective: Reduce overall cost and
close loss making/costly production facilities
 When market demand reduces or shifts to other
substitutes, whichever factory caters that market will
be the first one to go
 Wherever raw material is least
available/transportation is costly
 Whichever facility requires higher transportation cost
 Whichever factory has higher production cost
 Least available workforce/costly manpower
 Power/Energy costs
 Whichever factory goes through more trade barriers
while catering to international market

8. Why not carry any finished
product inventory?
 Storage cost
 Accidents may lead to higher costs
 Maintenance cost
 Management/Operations cost in connection to
the warehouse
 Be more competitive; can introduce new
products in a short notice
 Intel’s new chips can be integrated as soon as they
hit the market
 Avoid loss from cases where some products are
not sold when the demand shift to substitutes

9. Should a firm with an investment in
retail stores carry any finished
goods inventory?
 For those products for which customers
can wait for a few days there is no need
to have finished goods inventory
 For those products for which customers
cannot wait for the time required for the
product to reach the customer from the
production facility there needs to have
a production facility

10. Characteristics of products that
are most suitable to be carried in
finished goods inventory
 Nonperishable goods can only be stored
 Goods that have least possible storage cost
 Goods that have fluctuating/seasonal demand
 Where SCM/CRM systems are not adequate to have
knowledge of the market demand
 Retailers store goods that have stable demand
in the local market in the local market
 Where there is a time gap between supply shipments
from the manufacturer
 Where there is a chance of import tariffs to increase
 When there is a chance of the product price to
increase

11. Characterizes products that are
best manufactured to order
 Where there is a demand from the
customers for product customization
 If it’s possible to manufacture as per the
customer’s demand; the production
process needs to be cost effective

12. Is the Dell model of selling directly without
retails stores always less expensive than a
supply chain with retail stores???
 Generally
 Incase of Customization; retail stores will incur
higher cost for storage
 However, it is not necessarily more
profitable:
 If customer demand is higher for retails stores
where they can check out the product first
hand;
 If customer is satisfied with online shopping

13. What are the supply chain implications
of Gateway’s decision to offer fewer
configurations???
 Supplier
 Suppliers needs to send fewer varieties of
components
 Management/Operational complexity/costs reduces
 Internal Supply Chain: Transport of components
within the factory is much less complex
 Suppliers needs to send fewer varieties of
components
 Management/Operational complexity/costs reduces
 Retailers/Dealers:
 Suppliers needs to send fewer varieties of
components
 Management/Operational complexity/costs reduces

14. Thanks!!!