Professional Documents
Culture Documents
Designing
Distribution
Networks and
Applications to
E-Business
4-1
Outline
The Role of Distribution in the Supply Chain
Factors Influencing Distribution Network Design
Design Options for a Distribution Network
E-Business and the Distribution Network
Distribution Networks in Practice
Summary of Learning Objectives
4-2
Factors Influencing
Distribution Network Design
Distribution network performance evaluated along
two dimensions at the highest level:
Customer needs that are met
Cost of meeting customer needs
4-4
Factors Influencing
Distribution Network Design
Elements of customer service influenced by network structure:
Response time
Product variety
Product availability
Customer experience
Order visibility
Returnability
Inventories
Transportation
Facilities and handling
Information
4-5
Response Time
4-6
Number of facilities
4-7
Number of facilities
4-8
Number of facilities
4-9
Number of Facilities
4-10
Retailer
Customers
Product Flow
Information Flow
4-12
Retailer
In-Transit Merge by
Carrier
Customers
Product Flow
Information Flow
4-13
Warehouse Storage by
Distributor/Retailer
Customers
Product Flow
Information Flow
4-14
Distributor/Retailer
Warehouse
Customers
Product Flow
Information Flow
4-15
Retailer
Cross Dock DC
Pickup Sites
Customers
Customer Flow
Product Flow
Information Flow
4-16
Response Time
Manufacturer
Storage with Direct
Shipping
Manufacturer
Storage with InTransit Merge
Distributor Storage
with Package
Carrier Delivery
Distributor
storage with last
mile delivery
Manufacturer
storage with pickup
Customer Experience
Order Visibility
Returnability
Inventory
Transportation
Information
Product Variety
Product Availability
4-17
Manufacturer
Storage with
Direct Shipping
Manufacturer
Storage with InTransit Merge
Distributor Storage
with Package Carrier
Delivery
Distributor storage
with last mile delivery
Manufacturer
storage with
pickup
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4-18
4-19
Impact of E-Business on
Customer Service
Response time
Product variety
Product Availability
Customer experience
Time to market
Order Visibility
Returnability
Direct Sales to Customers
Flexible Pricing, Product Portfolio, and Promotions
Efficient Funds Transfer
4-20
4-21
4-23