Your team will play the roles of a Freight Forwarder and a materials and distribution manager for Apotex Pharmaceuticals in Montreal. Your freight forwarder is GCA (Global Canadian Agents) and Apotex can take care of the delivery to GCA at the airport terminal using their own trucks. Your team is responsible for all transportation, distribution, materials, and purchasing for your firm.
Your companies have been hired to deliver aid to the conflict zone of Yemen, supplying emergency pharmaceuticals to Medicin sans Frontiere in that country. The United Nations has brokered a fragile peace plan, and the blockade of Yemeni Ports and risks to air traffic will be lifted for a one-week period. Your task is to take this opportunity to deliver 4.5 cubic meters of materials weighing 1.2 metric tonnes and having a value of $8,000,000.00. You are responsible for deciding all logistics necessary to deliver the goods to the hospital in Yemen.
You have, so far, found the best two choices to get the cargo close to the destination, but you will need to recommend the best choice and the method of delivery to the final destination in the Governorate of Amran, in the north-west interior of Yemen.
Montreal – New York – Riyadh
(Air freight, UPS via JFK)
Montreal – JFK by express truck, CAN $15.00/100 lb.
JFK – RUH: +500 kg – US $11.02/kg
Montreal – Paris – Cairo
(Own consolidation to Paris, then your French agent’s consolidation to Cairo)
YUL – CDG: +300 kg – CAN $3.36
CDG – CAI: +500 kg – EUR 6.93
Exchange rate: US $1.00 = CAN $1.30
EUR 1 = CAN $1.40
As a team, Apotex, Freight Forwarder, and the customer (Medicin sans Frontiere) decide on the following:
1. Calculate the chargeable weights and freight charges for both alternatives. (5 marks)
Ref.: Module 8
1. Conduct a CREEEPSS risk analysis for conducting such a delivery to Yemen. Use this criteria and the above freight costs to recommend a route See: The Consequences of War in Yemen (3 marks)
Ref.: Module 9
MSF. (2019, June 25). Indirect consequences of war in Yemen | MSF. Médecins Sans Frontières (MSF) International. https://www.msf.org/indirect-consequences-war-yemen
2. Find the most appropriate mode(s) and routes for the final delivery (from Cairo or Riyadh) to the hospital in Amran. Outline the finalized complete route on appropriate maps (door to door). (3 marks)
Ref.: Module 10
3. Recommend the Incoterms® for Apotex to use in this case, given the available information on your customer. Completely justify your decision. (3 marks)
Ref.: Module 11
4. Outline the role the freight forwarder will play in the transaction and describe all the necessary transportation documentation. (3 marks)