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CHAPTER CASE 1-1: Central Transport, Inc. Case Notes: 1. Why and how had the competitive market place for SAB changed in the last five to seven years? Although there are five majors reasons explained for increased competitiveness in the marketplace, SAB was confronted largely by two of these: globalization and organizational consolidation. SAB had to compete against large retailers like Wal-Mart who were able to bypass middlemen, such as SAB. In addition, globalization was providing an ever growing availability of inexpensive alternative sources and products. 2. What advantages might Central experience in the proposed new venture? Central might experience a growing advantage in its ability to provide third-party logistics (3PL) that the large retailers were not accustomed to providing, in areas such as warehousing, transportation delivery, and inventory management. 3. What issues would SAB and Central face in the proposed new approach? SAB and Central would be faced with improving three principal supply chain flows consisting of products, information, and financials (cash). These flows will require improved levels of communication and coordination, flexibility, responsiveness, and new technologies.
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