Bloomex Case Paper

The team’s recommendation means that Bloomex should highly consider constructing the Miami facility and using all three locations. What this signifies is that Bloomex will have to spend a certain costs to build the facility, but will get a long term benefit from faster response time and lower shipping costs because the shippers have more options to take. There would be an increased utilization of facilities and can operate under greater flexibility. However, with increased transshipment centers, the benefits come at a cost of uncertainty. There would be an inevitable increase in risk Bloomex might potentially face. The trade-off Bloomex makes from choosing Option C compared to Option A would be reducing shipping costs and response time greatly but may have to deal with a larger, complex network, where more uncertainties would lie ahead.
Therefore, Bloomex should think carefully and weigh the benefits. If saving the shipping costs and reducing time, thereby better customer
Should Bloomex go through legal documents and build the facilities from the base or lease and rent a pre-existing center. The team suggests the latter choice of leasing because there is less risk involved. For example, if the company does not sell as well as before and needs to cut down on centers, then it can just end the contract. However, if the leasing is expensive, then finding economical ways to build the facility is also not bad. The team is risk-averse, and believes that Bloomex should lease for one year and see the sales and demand data. Moreover, Bloomex should keep in mind about the demand. Many of the facilities are located within the North American region. Bloomex should forecast or see if it wants to expand the service beyond borders, like into Europe and Asia. For instance, if demand from Asia increases, then Bloomex might consider how to deliver to those regions, either through subcontracts or a new