Company overview:

ACI Logistics Limited was formed in 2008 with a vision to setup nationwide retail outlets, named Shwapno, to utilize ACIs strong presence in Bangladesh through implementation of world-class supply chain mechanism. Now Shwapno operating about 59 outlets in 16 districts of Bangladesh and they are also willing to grab more market share by opening lots of new outlets in all over Bangladesh. ACI Companys journey started from the ICI Bangladesh manufactures limited which was a subsidiary of renowned multinational ICI Plc and was a listed public limited company under Dhaka Stock Exchange In 1992 ICI Plc divested its shareholding through a management buyout and the company name was changed from ICI Bangladesh Manufacturers Limited to Advanced Chemical Industries (ACI) Limited. ACI Formulations Limited, a subsidiary of ACI, became a public listed company through direct listing. ACI has diversified into four major strategic business divisions which include Health Care, Consumer Brands, Agribusinesses and Retail Chain. Strategic Business Units:

Pharmaceuticals Consumer Brands & Commodity Products Agribusinesses:

o o o o o

Crop Care Public Health Livestock & Fisheries Fertilizer Cropex Seeds

ACI has the following subsidiaries:

ACI Formulations Ltd. ACI Agrochemicals Apex Leathercrafts Limited

ACI Salt Limited ACI Pure Flour Limited ACI Foods Limited Premiaflex Plastics Limited Creative Communication Limited ACI Motors Limited ACI Logistics Limited

Joint Ventures:

ACI Godrej Agrovet Private Limited Tetley ACI (Bangladesh) Limited Asian Consumer Care (Pvt) Limited

Distribution strategies adopted by food industries supply chain:

Distribution strategy as an element of competition in companies Observation of the mechanisms which stimulate behavior of participants of particular markets indicates that one of the most important areas where most of companies expects opportunities and where they form the basis for its advantage over competitors is distribution of goods i.e. its quality. Economic approach shows distribution with division of broadly understood goods among members of society. This division depends on social, economical and political systems in each country. They include various allocations of benefits and funds, although market economy causes that distribution translates into exchange of goods and cash, as a result of which the goods find its final recipient. Macroeconomic point of view treats distribution in categories of processes and proper structure through which the flow of goods takes place from the point of manufacturing to the place of final reception. His transfer is enabled through the channels with technical and material equipment and the interrelations between them which impact on the choice of flow of goods. Microeconomic approach to distribution impacts on decisions made during formulation of company strategy since it is presented as a choice of method of sale and way of finished goods to final recipients.

The products offered in right place just in time and which suite for their tastes and preferences present point of view of distribution in the company, which satisfies the wishes and needs of customers through making right decisions and taking right action.

Time and space aspects of flow throughout the system are also vital as is the quantity and quality of the goods offered to final recipients i.e. customers. Providing consumers with the desired goods forces companies to execute numerous and complex tasks. These tasks include Delivering finished products to consumption or use by recipients, with consideration of quality, durability and guarantee of storage or appropriate packaging Reduction in time of delivery, if it is forced by such a need Distribution cost reduction making lead time flexible with consideration of delivery cancel or individual lead times Extension of services for customers when such a need arises Ensuring delivery according to the specific orders ( compliance with quantity) Quality and assortment and completeness of equipment market analysis in the context of demand with consideration of competitive companies standing

Factory

Warehouse storage by distribution retailer

Custome r

Product Flow : Information Flow:

As we have studied the whole supply chain network of Shwapno we found their distribution networks similarity with the distribution model called Distributor Storage with Carrier Delivery. Here the inventory of Shwapno is not held by manufacturers at the factories but is held by

distributors / retailers in intermediate warehouses and package carriers are used to transport products from the intermediate location to the final customer. Information and product flows when using distributor storage with delivery by a package carrier are shown in the figure. Relative to manufacturer storage, distributor storage will require a higher level of inventory because the distributor / retailer warehouse aggregates demand uncertainty to a lower level than the Manufacturer. From an inventory perspective, distributor storage makes sense for products with Somewhat higher demand.

Shwapno stocks the medium to fast moving items at their warehouse with slower moving items stocked further upstream. In some instances, postponement can be implemented with distributor storage but it does require that the warehouse develop some assembly capability. Distributor storage, however, requires much less inventory than a other retail network. Shwapno Transportation costs are somewhat lower for distributor storage compared to other retail chain shops because an economic mode of transportation can be employed for inbound shipments to the warehouse, which is closer to the customer. Shwapnos Distributor storage allows outbound orders to the customer to be bundled into a single shipment further reducing transportation cost. Transportation savings from distributor storage relative to manufacturer storage increase for faster moving items. Compared to manufacturer storage, facility costs are somewhat higher with distributor storage compared to the other distribution models because of a loss of aggregation. Processing and handling costs are somewhat reliable compared to the other retail chain shops. Shwapnos distributor warehouse serves as a buffer between the customer and the manufacturer, decreasing the need to coordinate the two completely. Real time visibility between customers and the warehouse is needed, whereas real time visibility between the customer and the manufacturer is not.

Visibility between the distributor warehouse and manufacturer can be achieved at a much lower cost than real time visibility between the customer and manufacturer. Response time is better than other retail chain shops because distributor warehouses are, on average, closer to customers and the entire order is aggregated at the warehouse when. Customer convenience is high with Shwapnos storage. Order visibility becomes easier than with manufacturer storage because there is a single shipment from the warehouse to the customer and only one stage of the supply chain is directly involved in filling the customer order. Return ability is better than with Shwapno. The customer also has to return only one package even if the items are from several manufacturers.

The performance of distributor storage with carrier delivery is summarized below:. Distributor storage with carrier delivery is well suited for medium to fast moving items. Distributor storage also makes sense when customers want delivery faster than offered by manufacturer storage but do not need it immediately. Distributor storage can handle somewhat lower variety than manufacturer storage but can handle a much higher level of variety than a chain of retail stores.

Comparison of 2 organization
Improvement in supply chain (Recommendation ki ki dhoroner jinish anle customer need satisfy hobe)
performance occurs for the following reasons: Reduction in inbound transportation cost because of truckload shipments from manufacturers to distributor . Reduction in outbound transportation cost because the distributor combines products from many manufacturers into a single outbound shipment . Reduction in inventory costs because distributor aggregates safety inventory rather than disaggregating at each retailer. A more stable order stream from distributor to manufacturer (compared to erratic orders from each retailer) allows manufacturers to lower cost by planning production more effectively. By carrying inventory closer to the point of sale, distributors are able to provide a better response time than manufacturers can. Distributors are able to offer one stop shopping with products from several manufacturers .