types of distribution network in supply chain

This approach: Key #4 Network DesignHere is what you need to know, Download Free Distribution Network Design Chapter, Copyright © 2020 Logistics Bureau Pty Ltd. SEO by Online Marketing Whiz. Provides a range of high level network options for comparative decision making. A supply-chain network can be strategically designed in such a way as to reduce the cost of the supply chain; it has been suggested by experts that 80% of supply chain costs are determined by location of facilities and the flow of product between the facilities. ", "Environmental supply chain network design using multi-objective fuzzy mathematical programming", https://en.wikipedia.org/w/index.php?title=Supply_chain_network&oldid=950641813, Creative Commons Attribution-ShareAlike License, This page was last edited on 13 April 2020, at 03:38. [7][9], Bosch is a company that capitalises on this closed-loop system by building sensors into their power tool motor. [3] Though there is inherent uncertainty about the future, a supply chain network risk analysis can be conducted; by using information available, the future business environment can be characterised. 148 0 obj << /Linearized 1 /O 150 /H [ 768 644 ] /L 266506 /E 65440 /N 42 /T 263427 >> endobj xref 148 16 0000000016 00000 n trailer << /Size 164 /Info 146 0 R /Root 149 0 R /Prev 263416 /ID[<8bc695392d3614cfb37415a55bfe0244>] >> startxref 0 %%EOF 149 0 obj << /Type /Catalog /Pages 141 0 R /Metadata 147 0 R /PageLabels 139 0 R >> endobj 162 0 obj << /S 675 /L 755 /Filter /FlateDecode /Length 163 0 R >> stream The uncertainties associated with supply-chain networks fall within two categories, Endogenous uncertainty and Exogenous uncertainty. But of course, having the right software tool is only part of the mix! Exogenous uncertainties can be further categorised; ongoing risks such as economic volatility, can be described as a 'continuous risk'. The risk to the supply-chain network can be minimised by being well prepared for potential events. Networks can be modeled from factory to the consumer, taking into account all the key cost and service drivers such as: We have also developed a fast track network test, that uses market based warehouse and transport costs, read more below. Based on 100+ similar network studies, our specialist consultants are able to apply market based costs for your warehousing and transport operations. 0000004388 00000 n Logistics Bureau’s consultants have conducted 100’s of network studies for a vast range of customers, across a variety of industries and in many countries. Are your inventory stocking locations not in the ideal place to best serve your customers? - Logistics & Materials Handling Blog | Adaptalift Hyster", "How to Reduce Costs through Supply Chain Network Optimization", "When is it a good time for supply chain network design? 0000004164 00000 n Transportation modes that operate within a supply-chain network can include the many different types of trucks, trains for boxcar or intermodal unit movement, container ships or cargo planes. Physical locations included in a supply-chain network can be manufacturing plants, storage warehouses, carrier crossdocks, major distribution centres, ports, intermodal terminals whether owned by a company, suppliers, a transport carrier, a third-party logistics provider, a retail store or an end customer. All organisations can purchase the components to build a supply-chain network, it is the collection of physical locations, transportation vehicles and supporting systems through which the products and services firm markets are managed and ultimately delivered. A company has a very limited ability to prevent exogenous uncertainty. Bosch can quickly assess the state of a motor reducing the cost of inspection and disposal, thereby increasing their profit margin on refurbished power tools.[8]. We have used these models as part of major consultancy projects in industries such as retail, beverages, FMCG, building products, pharma, automotive and many others. Network Modeling Approach. �/e� All organisations can purchase the components to build a supply-chain network, it is the collection of physical locations, transportation vehicles and supporting systems through which the products and services firm markets are managed and ultimately delivered. 0000002291 00000 n The business requirements of a network will change over time. This can be due to mergers and acquisitions, entering new markets, expanding product ranges or indeed changes to the regulatory environment. Yes! 0000004857 00000 n Specialist Supply Chain network modeling software is used to allow cost and service optimisation of the network to be established. A key part of designing the supply-chain network is ensuring the network is versatile enough to cope with future uncertainties. Therefore, it can be said that a SCN design is the combination of nodes with capability and capacity, connected by lanes to help products move between facilities[6], There is no definitive way to design a SCN as the network footprint, the capability and capacity, and product flow—all intertwine and are interdependent. This experience shows us that for companies that have never undertaken such a study or that have undergone or plan to undergo significant change in their Supply Chain, there is a high degree of risk that: Read on to learn more about our approach and see some articles on the topic, or if you would like help in understanding the topic, or just someone to bounce some ideas off, feel free to contact some of our key staff directly, whose details are shown below. You only need to supply customer locations and demand data to allow a range of network options to be quickly modeled. Excessive product damage could be occuring. Network costs could be 10-15% higher than expected norms. [10], By distinguishing between these types of uncertainty, an organisation can decide the best approach to risk management. Our distribution strategy consultants can determine the optimal Supply Chain or Distribution network to satisfy customer demand at specified service levels and at the lowest cost. Provides models in a fraction of the time and cost of more detailed approaches. Though designing a supply-chain network can cut costs within a company, it is important to note the supply chain is not static but rather a continually improving model and adapt in response. Following on from this, there is also no single optimal SCN design, in designing the network there is an apparent trade-off between responsiveness, risk tolerance and efficiency. [10], Document automation in supply-chain management & logistics, Examples of reverse supply network design, Building a Flexible Supply Chain Network from SC Digest, "What is a Supply Chain Network? You can see some of the simple but useful graphic outputs at Mapping Products. Logistics Bureau’s consultants have developed a ‘fast track’ network modeling approach for those companies that merely want to quickly test a range of distribution network options at a high level, or do not have the ability to gather detailed cost data on their own networks at this time. 0000004936 00000 n 0000001412 00000 n Please send me your fortnightly Email Bulletin. 0000001570 00000 n Why not send through an email or book a free 1 on 1 ‘Advisory Call’ right now? [2] Supply-chain networks are now more global than ever and are typically structured with five key areas: external suppliers, production centres, distribution centres (DCs), demand zones, and transportation assets[3]. Q���(��Փ�������'���O��=��/�6�&@�2h. Our distribution strategy consultants can determine the optimal Supply Chain or Distribution network to satisfy customer demand at specified service levels and at the lowest cost. H�b```#�; �� Service lead times may be adversely impacted. Endogenous uncertainty can be somewhat mitigated with precautions such as regular communication between an organisation and supplier. [10], An uncertainty can be categorised as 'endogenous' when the origin of the risk is within the supply-chain network itself, such as market volatility or technological turbulence. These types of projects are normally carried out as a result of significant business growth, acquisition, or a need to reduce supply chain complexity and costs. 0000038975 00000 n �,��o+X�C��1{�p�$��e����e6K�|���,Y,,�� �/���lZ��R��`�2�J��ը��m��̷Y��(�z�.�y�ᘑ�dI5#�����%��3 Changing the distribution network design affects the following supply chain costs: • Inventories • Transportation • Facilities and handling • Information As the number of facilities in a supply chain increases, the inventory and resulting inventory costs also increase as shown in Figure 4.2. Warehouse (Distribution Centre) size, location, resources, costs…, Improved understanding of customer service needs and options, Appropriate balance of storage, inventory and transport costs, Graphical mapping of customer demand and density, Access to leading distribution network modeling tools and methods, Also, this type of work is often linked with customer profitability analysis, product profitability analysis and Cost To Serve (CTS) audits.

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