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PresentationJune 16, 2010
Welcomes
“Is Fortune in the Future for ACME?”
Karen Allec
Good Leadership Corporate Culture is open to change Currently competing effectively despite
identifiable financial and operational waste.
Push System Costly Warehouse and Transportation Outdated IT systems
Industry Trends Research
Competitors Economic
Conditions Political
Influences Analytical Tools
Citation; GIS in Logistics & Fleet Management, Karl Terry ERSI
Streamline Operations Reduce Supply Chain cost Open new markets - E Commerce Environmental Awareness Automate systems Improve GP Increase cash flow
REACHING OUR REACHING OUR GOALGOAL•To combine “best practices” of the nations largest retailers to create a unique, integrated retail supply chain model for ACME.
INFORMATION TECHNOLOGYINFORMATION TECHNOLOGY
“A journey of a thousand miles, begins with a single step.”
Lao Tzu
Septiadi “Andy” Tjahjono
THE BASIC IDEATHE BASIC IDEA
ERP: What Is It?
ACME current situation Inconsistent, Inefficient Processes Stand alone application Inventory Management
The key of ERP is INTEGRATION Unification of all key operational systems
CURRENT ACME CURRENT ACME ERPERP
Logistic MGR
Finance Dept
Store Receiving Clerk
Head OfficeDistribution Center
PROPOSED ACME HOSTED PROPOSED ACME HOSTED ERPERP
Head Office
Store
Data Storage
ANSI X12Trading Partners
EDIFACTTrading Partner
XMLTrading Partners
EDI Webhosted ERP
Web Based Report
SCREEN SHOOT HOSTED SCREEN SHOOT HOSTED ERPERP
BENEFITS HOSTED ERPBENEFITS HOSTED ERP
Improve access to information Improve workflow and efficiency Improve controls and program alerts Process reengineering -- update old
processes Foundation for new processes, such
as e-procurement, with significant ROI
BENEFITS OF AUTOMATION + INCREASING BENEFITS OF AUTOMATION + INCREASING EFFICIENCYEFFICIENCY
= REDUCED COSTS = REDUCED COSTS
Increase CFT capacity Reduce Sq.Ft.
Reduced Errors Reduce Overtime
Increase Operation Efficiency
IncreasedProductivity
No WMS
New WMS
Warehouse/Distribution
ACME Current Cost ILC Hosted model
Server hardware and OS Upgrade $100K and up Host provides
IT Salaries (Programer, data base etc) $60K to $150K Bill @perhour rate
Support & Help Desk $45K to $75K Host provides
Translator Software $100K and up Host provides
EDI Mapping Tools $100K and up Host provides
Transaction Data Backup $300K Host provides
Updates & Changes (Software) $250K
Changes may be a fee or free and are automatically made available to
all through the central hosting service
Late Fee & Charge back $500K - $1M
Significantly reduced by increased accuracy and timely transaction
processing
Maintenance Fee $1M - $2M $700K
COST HOSTED ERPCOST HOSTED ERP
ASNCargo Receiving
Receiving and Checking Barcode Scanning
Sortation ConveyorsBarcode ControlledAuto PalletizerInventory Control
Inventory ControlLocation ControlQC
Sortatiion Conveyers
Sorting, Barcode Scanning
Automation Inventory Control
Integrates and Unifiesdata into onecentralizeddatabase
AmericaUnifies Freight,Accounting andWarehousing
Systems
Japa
nU
nifie
d Fr
eigh
t
Acc
ount
ing
and
War
ehou
sing
Sys
tem
s
Asia
Unified Freight
Accounting and
Warehousing S
ystems
Europe
Unified Freight
Accounting and
Warehousing
System
s
Sou
th A
mer
ica
Uni
ted
Frei
ght
Acc
ount
ing
and
War
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sing
Sys
tem
s
EDICustomers,
Vendors, Govt.Agencies
EDI
CustomerCustomerILC
Security Reports
Inte
rnet
Acc
ess
Tracking &Tracing
Pro
activ
e E
xce
ptio
nM
anagem
ent
He who will not economize, will agonize.
Confucius
Chinese philosopher & reformer (551 BC - 479 BC)
Distribution / WarehousingSpeaker:
Dan Phillips
Combine “best practices” of the nations largest retailers to create a unique, cohesive working retail supply chain model.
WalmartWalmart TargetTarget JCPenney’sJCPenney’s 4200 stores 1740 Stores Utilization of 3rd Party
DC’s 42 DC’s 37 DC’s Direct to Store 100 Stores / DC 47 Stores / DC
Cost Containment / Cost Savings: Consolidate Orient Suppliers Increase ocean DIM / Reduce # of containers / Reduced Emissions, Carbon Decrease Travel Time / Reduced Emissions, Carbon Reduce DC’s / Reduced Carbon footprint
Origin
Current Model> 800 stores40 DC’s
Hong KongPusanShanghaiManilaTaiwan
1316 FEU’s (40’ D
ry)
1228 FEU’s (40’ Dry)
Total FEU’s:2544 (40’ Dry)
Origin
Phase I Distribution Closures40 DC’s will convert to; 3 Import Whse / Market Areas 32 Regional's
Hong KongPusanShanghai
LA/LB 40% * West 120 stores * South 180 stores
Open3) Imports – Los Angeles, Chicago, Dallas1) Regional – Seattle, WAClose9) Las Vegas, NV – San Francisco, CA – Phoenix, AZ – Denver CO – Kansas, KS – La Grange, GA –Savannah, GA – Baton Rouge, LA – Spokane, WA
1336
FEU
’s (4
0’ H
C)
Prince Rupert 60% * Chicago 500 stores
890 FEU’s (40’ H
C) 534 FEU’s (40’ HC)
Total FEU’s:2226 (40’ HC)
Origin
Hong KongPusanShanghai
Phase I Distribution Closures35 DC’s will convert to;26 Regional's (one being E-com)
Conversion1) DC to E-commerce – Louisville, KYClose9) Wilmington, DE – Rockford, IL – Normal, IL – Baltimore, MD – Northbridge, MA – East Orange, NJ – Moon, PA – Macon, GA – Springfield, IL
LA/LB 40% * West 120 stores * South 180 stores
1336
FEU
’s (4
0’ H
C)
Prince Rupert 60% * Chicago 500 stores
890 FEU’s (40’ H
C) 534 FEU’s (40’ HC)
Total FEU’s:2226 (40’ HC)
Origin
Hong KongPusanShanghai
Phase I Distribution Closures26 DC’s will convert to;13 Regional's (one being E-com)
Final 13Los Angeles, CA – Seattle, WA – Dallas, TX – Louisville, KY – Atlanta, GA – Hartford, CT – Edison, NJ – Little Rock, AK – Charleston, SC – Chicago, IL – Akron, OH – Des Moines, IA – Indianapolis, IN
Open0) Close13) Clearwater, FL – St. Paul, MN – Raleigh, NC –Albany, NY – Washington, DC - Miami, FL – Birmingham, AL – Plymouth, PA – Tulsa, OK – Salt Lake City, UT – Houston, TX – Albuquerque, NM – Detroit, MI
Total FEU’s:2226 (40’ HC)
“If we face our tasks with the resolution to solve them, who shall say that anything is impossible.”
Sven von Borries
Sir Wilfred Thomason Grenfell
New Rate negotiation (Ocean Freight) Change from 5 to 3 suppliers (SHA/HKG/PUS) -> ABP have
same /lower rate Change from 40’ DRY to 40’ HC -> less 318 Containers / year New Distribution model (Intermodal) Total Savings of USD 2.8 million
Origin
Hong KongPusanShanghai
Total Feu’s:2226 (40’ HC)
“The most dangerous kind of waste is…….
the waste we do not recognize.”
Shigeo Shingo
Sokchanda Im
What drives green initiatives?
Government Policies & Regulations
Social Factors Long-term Cost Savings
Distribution Centers Lighting
Light Emitting Diodes (LED) Light Sensors Skylights
Water Conservation Transportation Improved Freight Logistics Smart Driving Practices Increase Railway Use
35
TRAILERS BY TRAIN (LA to Chicago) TRAILERS BY TRUCK (LA to Chicago)
1 train carrying 123 trailers 123 trucks
2,200 rail miles 2,015 highway miles
Consuming 19,400 gallons of diesel fuel Consuming 38,100 gallons of diesel fuel
274 metric tons CO2e carbon footprint 535 metric tons CO2e carbon footprint
49%49%Transporting by rail, you reduced this shipment’s carbon footprint by 49%
Transporting by rail, you reduced this shipment’s carbon footprint by 49%
Source: The U.S. EPA’s Climate Leaders program emission factors (Direct Emissions from Mobile Combustion Sources, May 2008); BNSF’s carbon emission estimator was formed in collaboration with ClearCarbon Consulting, Inc.; Other sources include BNSF shipment history and internal shipping metrics, along with route mileage calculation programs, trucking system averages (Truck Assumption: 6.5 mpg highway), and other data sources.
Carbon Savings | BNSF Intermodal Trailers vs OTR
36
CONTAINERS BY TRAIN (LA to Chicago)
CONTAINERS BY TRUCK
(LA to Chicago)
1 train carrying 256 units 256 trucks
2,200 rail miles 2,015 highway miles
Consuming 25,400 gallons of diesel fuel Consuming 79,400 gallons of diesel fuel
420 metric tons CO2e carbon footprint 1,113 metric tons CO2e carbon footprint
Source: The U.S. EPA’s Climate Leaders program emission factors (Direct Emissions from Mobile Combustion Sources, May 2008); BNSF’s carbon emission estimator was formed in collaboration with ClearCarbon Consulting, Inc.; Other sources include BNSF shipment history and internal shipping metrics, along with route mileage calculation programs, trucking system averages (Truck Assumption: 6.5 mpg highway), and other data sources.
62%62%Transporting by rail, you reduced this shipment’s carbon footprint by 62%
Transporting by rail, you reduced this shipment’s carbon footprint by 62%
Carbon Savings | BNSF Intermodal Containers vs OTR
FOREIGN TRADE ZONES
BONDED WAREHOUSES
Bonded WarehouseRemarks
Goods are entered and stored without Customs formalities or control.
YES NO Formal entry is made. Goods are under continuous customs control.
Goods are not in US for Customs and excise taxes purposes.
YES NO Goods are in US for Customs purposes.
Imported goods may be manipulated, processed mixed with other foreign or domestic goods, without Customs supervision or expense.
YES NO Foreign dutiable goods are stored and manipulated under constant customs supervision at Owner Expense. Specific authorization needed for each lot.Goods may be withdrawn in any amounts
and any size package, or may be repacked.
YES NO Goods may be withdrawn only in an entire bale, case, box, etc. and in original package. Permission needed to repack.
Liquidation occurs at the time goods enter Customs territory. No permission needed to manipulate.
YES NO Liquidation occurs at the time goods enter Warehouse. Permission is needed to manipulate.
Any goods free or dutiable that may legally enter the US may enter an FTZ.
YES NO Only dutiable merchandise may enter.
Public utilities rates are published same to all clients.
YES NO Rates are not usually regulated.
Relatively unrestricted movement of goods in and out of zone.
YES NO Limited movement of goods, specific Customs approval is required for each movement.
No Bond required, even for durable goods. YES NO A bond for double the amount of estimated duty on each entry must be posted.
Goods may remain without limit of time. YES NO Five year maximum limit.
Panama - FTZ vs Traditional Bonded Warehouse
LOW CUSTOMER
SATISFACTION
POOR SUPPORT
LOW QUALITY PRODUCT HIGH PRICING
CAUSES OF LOW CUSTOMER SATISFACTION
Cost of Materials
Ineffective Marketing
IncompetentEmployees
Bad Design
Poor Materials
Wrong Answers
Long Hold Times
Fee Structure
“A man who misses his opportunity, and monkey who misses his branch, cannot be saved.” “Hindu Proverb”
Greg Matthews
Open new markets – Ecommerce, Western US, Central & South America
We look forward to working with you.
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