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OPERATIONAL MANAGEMENT

ASSIGNMENT-1

The Tao of Timbuk2 Case Study

Q. 1 Consider the two categories of products that Timbuk 2 makes and sells. For the custom messenger
bag, what are the key competitive dimensions that are driving sales? Are its competitive priorities
different for the new laptop bags sourced in China?

ANS 1- For the custom messenger bag that Timbuk 2 sells have the following key competitive
dimensions that are driving sales: -
• It is a trusted everyday companion for the customer and creates a bond between the
customer and the bag.
• It also has an emotional bond with the customer and a good perception of the value of the
customer's mind.
• Customers also believe that it is indestructible and it is superior to its competitors.
• Customers can save their time by customizing their bags with a wide selection of designs
and sizes and quick delivery of bags within 2 days of online ordering.
• With the China's new laptop bag, the company emphasizes functionality, quality, and value
at a reasonable price, rather than expressing this as customer loyalty. We also found a
factory in China to reduce labor costs.

Q. 2 Compare the assembly line in China to that in San Francisco along the following dimensions: (1)
volume or rate of production, (2) required skill of the workers, (3) level of automation, and (4) Amount of
raw materials and finished goods inventory.

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ANS 2-

DESCRIPTION China assembly line San Francisco Assembly line

Volume or rate of production High rate of production Depends on customer

demand

Required skill of the workers Extremely high High

Level of Automation Elevated level of automation No automation required

required

Amount of Raw materials As the rate of production is Raw materials required

high there is need of a lot of would be according to the
raw materials demand of customers

Finished goods inventory Elevated level of finished No inventory is required as

goods inventory the product is delivered
overnight

Q. 3 Draw two diagrams, one depicting the supply chain for those products sourced in China
and the other depicting the bags produced in San Francisco. Show all the major steps, including
raw material, manufacturing, finished goods, distribution inventory, and transportation. Other
than manufacturing cost, what other costs should Timbuk2 consider when making the sourcing
decision?

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4.Cost to be considered by Timbuk2 while considering sourcing decision are as follows:-

ANS- Are as follows: -

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• Transportation costs
• Storage costs
• Personnel costs
• Overheads Logistics costs
• Government policies and costs related to Chinese taxation
•

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