Sands Corporation

Assignment 2 : Sands Corporation

A report submitted to

Prof. Gita Chaudhuri

In Partial fulfilment of the requirements of the course

Written Analysis and Communication – I

By

GAWADE MAYUR SUNIL

Section B

Roll No. 1911092

On

03-08-2019

[pic 1]

_____________________________________________________________________________________

13th August, 1961

To,

The President

Sands Corporation

Subject:  Report and analysis on installation of new plant

(Recomendation to setup plant at Kimberly)

Dear Sir, (Could have been Ma’am as well)

Attached herewith is the detailed report and analysis on installation of new plant of Sands Corporation. The company has two viable options of setting up of new plant, either at Kimberly Street or at Hampton. The viable options were thoroughly analyzed on basis of location, manpower availability and cost, probable resource expenditure and other such factors as deemed essential.

Hope this report and analysis meet your expectations and I will be available if you seek any more clarity on any matter stated herewith.

Regards,

John Doe

JD Consultancy Services (Provide short address as well)

One Page Summary (Just call it summary)

1. Situation Analysis: 

• Sands Corporation has acquired new government contract and has to setup new plant at either Kimberly street location or at Hampton location.
• Various factors and their cost and benefits must be considered to arrive at a decision.

1. Problem Statement:  Taking various factors into account, deciding whether the new Sands Corporation plant must be set up at either Kemberly Street or at Hampton location
2. Options: Following two options are to be considered and analyzed

1. Plant installation at Kimberly Street
2. Plant installation at Hampton

1. Criteria:   

1. Capital expenditure and overhead expenditure
2. Labour availability and cost
3. Benefits and other savings
4. Union and time crunch

1. Evaluation of options: 

1. Kimberly Street

Kimberling street has lower total cost estimation considering capital, overhead and labour costs. It has higher benefits and savings. Union has to be delicately handled.

1. Hampton

Hampton location has higher total cost estimation considering capital, overhead and labour costs. It has lower benefits and savings. No union at this location.

1. Recommendation: Sands Corporation should set up their new plant at Kimberly location considering all the factors and their analysis.
2. Action Plan: (Do not write Action Plan in summary)

1. Construction should be initiated within the next two weeks.
2. Manager-Employee relations should be given priority and grievances should be addressed within time so that union doesn’t mount pressure.
3. Abundance of manpower can be utilized and work shifts can be started.

1. Situation Analysis:

• Sands Corporation is engaged in manufacture of various parts for the automotive, aircraft and agricultural equipment industries and had annual sales of $26 million in the precious year that is 1960.
• The company’s main plant’s employees became members of a national union for collective bargaining representation in the year of 1942. Subsequently the company established its two new branches in the years 1943 and 1946. Not required
• Sands Corporation after winning the competitive bidding (Good) for contract of supplying military aircraft parts, realised in August, 1961 that the company required an additonal facility to produce parts on larger scale to be able to fulfill the government order. (Logical flow from contract winning to new facility required is present)
• The government order required delivery starting 10th April, 1962, and the contract also has a penalty clause for non-delivery set at $1,000 a day after the exhaustion of one week grace period. (Good)
• The plant requires 75,000 square feet of floor space and 600 employees, out of which 300 jobs would be available for skilled personnel, and 150 jobs each for semiskilled and unskilled personnel.
• The company has shortlisted two sites for final consideration, one at Kimberly street and another one at Hampton. Kimberly street location is few blocks from Clairmont’s main plant while the Hampton site is 180 miles away from the main plant.
• It is estimated that capital and overhead expenditure will cost $420,570 more at Hampton location than at Kimberly street location. Labour while it is cheaper in Hampton than in Kimberly street, the availability of required manpower is present in Kimberly street.
• Other savings and benefits such as savings in form of fewer administrative personnel required, better resale value and other such things are more visible at Kimberly street site than at Hampton site.
• NO EVALUATION OF OPTIONS AND CRITERIA IN SITUATION ANALYSIS
• The Kimberly street plant if setup would mean that the new 600 plant employees become part of main plant’s union due to proximity, while there will be no union at Hampton site.
• Contract was important for SC because it was a prestigious opportunity to improve its financials and future contract would depend on success of this contract.

2. Problem Statement:

Taking various factors into account, deciding whether the new Sands Corporation plant must be set up at either Kemberly Street or at Hampton location