Physical Dist and Logistics
Transcript of 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
Logistics management
Physical Distribution
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Inventory Management
Stock-out
Order lead time
Usage rate
Safety stock
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Material
s
Handling
Logistics management
Physical Distribution
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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
Logistics management
Physical Distribution
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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
Logistics management
Physical Distribution
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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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Efficient consumer response
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
Efficient consumer response