physical dist and logistics

8/12/2019 Physical Dist and Logistics

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Topic 8 - Agenda

Components

Physical distribution and logistics

management

Objectives

Supply chain management

Efficient consumer response


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.

Customer

Service

Reducing Total

Distribution Costs

Reduce cycle

time

Three objectives of Distribution Management


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Order

Processing

Logistics management

Physical Distribution


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.

Order Entry

Order Handling

Order Delivery

3 phases to Order Processing


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Inventory

Management




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Inventory Management

Stock-out

Order lead time

Usage rate

Safety stock


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Material

s

Handling




9/21.

Electronic data interchange

Containerisation

Unit loading

Materials handling

Material requirements planning

Just in time (JIT)


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machine-readable bar code

readable 12-digit UPC number

manufacturer identification number

first six digits of the UPC number - 6 3 9 3 8 2

UPC number

next five digits - 0 0 0 3 9

item number

+ check digit


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.

Electronic data interchange

Containerisation

Unit loading

Materials handling

Material requirements planning

Just in time (JIT)


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The mean ing o f MRP

(Materials Requ irements Plann ing

MRP

Deciding thevolume andtiming ofmaterials flowin dependentdemandconditions

Demand forproducts and

services

Theoperationscustomers

Supply ofproducts and

services

Theoperationsresources


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What is requ ired to run MRP?

Masterproductionschedule

Materialsrequirements

planning

Materialsplans

Worksorders

Purchaseorders

Bills ofmaterials

Inventoryrecords

Customerorders

Forecastdemand


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The mean ing of just-in-t ime

Traditional approach

Focus onhighcapacityutilisation

Morestoppagesbecause ofproblems

High inventoryreduces thechance of theproblems beingexposed andsolved

Extra production goesinto inventory becauseof continuing stoppagesat earlier stages

Moreproductionat eachstage

JIT approach

Focus onproducingonly whenneeded Fewer

stoppages

Low inventoryso problemsare exposedand solved

No surplusproduction goesinto inventory

Lower capacityutilization, but


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Warehousing




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.

Warehousing functions

Receiving goods

Identifying Goods

Sorting Goods

Dispatching goods to storage

Holding goodsRecalling goods

Picking goods

Putting together

shipments (orders)

Dispatching the shipment

Supply side and demand side

In Out


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Transportation




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Physical dist r ibu t ion management

Operationsperformancedimension

Delivery speed

Reliability

Quality

Cost

Route flexibility

Road Rail WaterAir Pipeline

Mode of transport

2

2

2

3

1

3

3

3

4

2

1

4

4

5

3

5

5

5

2

4

4

1

1

1

5

1 - best performance, 5 - worst performance


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A form of strategic alliance


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Efficient Consumer Response

P&G value pricing - lower list price

no discounts and promotions etc

Efficient Consumer Response

Focus from gross to net (retailer and manufacturer)

Traditional supermarkets having a tough time

(costs and margin)

Efficient assortment

Efficient replenishmentEfficient promotion

Efficient product introduction

Activity based cost accounting

Economic value added

Structural and organisational implementation


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8 Agenda

Components

Physical distribution and logistics

management

Objectives

Supply chain management


physical dist and logistics

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