Distribution Logistics and Supply Chain Management

8/8/2019 Distribution Logistics and Supply Chain Management

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PRESENTED BY

VIBIN VELU

RANJITH KUMAR

KEVIN BOSE

RAMADOSS AKSSHAYA



y DISTRIBUTION LOGISTICS (Physical distribution)

efficient and effective product distribution

y CHANNEL MANAGEMENT

purchasing

storing

conversion of inputs into products

physical distribution of the input products

channel fns. of taking the product to the ultimate consumers

VENDORS--------------------------------------------CUSTOMERS

RAW MATERIALS---------------------------------END PRODUCT



y Supply chain-value chain

y Reduced cost

y Improved service



y Confers place and time utility on the product

y Helps build clientele

y Promising area for cost reduction



y Planning the physical distribution system

y In plant-warehousing

y Transportation

y Field warehousing

y Receiving

y Handling

y Secondary transportation

y Inventory management

y Order processing

y Accounting/record keeping

y Communication/reporting



y TRANSPORTATION

y WAREHOUSING

y INVENTORY MANAGEMENT



Steps involved

y Articulating distribution objectives andPrescribing the service level to be achieved in

product delivery y Finding out what the customers and channels

want in product delivery.

y Finding out what the competitors do

y

Optimizing the costs and Tackling the cost-Service Tussle

y Providing for flexibility in the system



y Distribution objectives of the firm must be properly articulated.

y minimum service level to be guaranteed

y The design should be able to meet with the promisesgiven to the customers

Ex: dominos



y Customers expectations most important task in this

function

y Timely delivery & exceptionally speedy delivery in

times of emergency.

Ex : DHL;UPS;DELL



y Competitors policies should be analysed.

y Different level of services they follow in productdelivery.

y Opt for the best suitable one.



y Service level

y Costs

Ex: Asian Paints



6%5%

39%

23%

27%

Customer Service/order entry

Administration

Transportation

Warehousing

Inventory carrying



y Flexibility of the system - in case of economical issues

y Flexibility should be ensured at the time of designingthe physical distribution system.



y The movement of products.

y Transportation modes

y Railroadsheavy, bulky full carloads of freighty Trucksflexible schedules, speed and access

y Waterwaysheavy, low-value non-perishables

y Airwaysfast delivery, high-value or perishable

goodsy Pipelinesbulk petroleum and chemicals



41.7%

28.2%

16.5%

13.2%0.4%

RailroadsTrucks

Pipelines

Waterways

Airways



y Choosing the right mix of transport modes

y Routing

y Operational plans

y Control of transportation costs



y Transportation cost is a major cost in most businesses

y Savings in transportation cost can be reailsed by:

(a) Optimizing the mix of transport modes

(b) Reducing the transport lead and lead-time(c) Eliminating multiple and wasteful transfer and

handling of products

Examples:



y Second major component of physical distribution

y Major steps involved are

(a) Designing a Warehousing System

(b) Determining the Location and Size of the warehouses

(c) Improving warehousing effectiveness



y Inventory costs keep rising

- Warehouse rent, handling cost etc.

y Optimum Inventory

- less stock (stock-out situation).

- Compromise between cost and service.



y

Ordering Time- Sufficiently before inventory becomes zero.

- Longer the lead time

y Order Quantity- Ordering cost and inventory cost

- Higher the quantity ordered, lesser the ordering cost but

more inventory cost.

- Inventory cost should be bothered than ordering cost.



Distribution needs integrated handling

- High cost transportation incurs higher price.

Outsourcing of logistics

- Higher service standards

- Cost effective

FedEx, Blue Dart, DHL etc.



Thank You

Distribution Logistics and Supply Chain Management

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