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Distribution & Supply chain

Management

Prof. Sameer Sonawane

Physical Distributions : Physical distribution includes all the activities associated with the

supply of finished product at every step, from

the production line to the consumers.

Important physical distribution functions include customer service, order processing, inventory control, transportation and logistics, and packaging and materials

Physical Distribution Management responsibility:

I.

Transportation

II.

Inventories

III.

Packaging

IV.

Warehousing

V.

Material handling

VI.

Location analysis

VII.

Order Processing

VIII. Customer services

Channels of distributions :

Channels of distributions :

Transportation : transportation is refer to the

movement of product from one location to the another as it makes its way from the

beginning of supply chain to the customer .

This is most important in supply chain as products are rarely produced and consumed

in same place.

Role Of Transportation In Supply Chain Management

Raw materials Supplier Manufacturing Consumer Distribution

Inventory Control

Inventory is the raw materials, component parts, work-in-process, or finished products that are held at a location in the supply chain

Why do we care?

At the firm level:

Sales growth: right inventory at the right place at the right time

Cost reduction: less money tied up in inventory, inventory management,

obsolescence

Why do we care? At the firm level: – Sales growth: right inventory at the right

Higher profit

Role of Inventory management in Distributions

Improve Matching of

Improve Matching of Supply

Supply

and Demand

and Demand Improved
and Demand
Improved

Forecasting

Reduce Material Flow Availability Time Reduce Waiting Time Reduce Buffer Inventory Supply / Demand
Reduce Material Flow
Availability
Time
Reduce Waiting Time
Reduce Buffer Inventory
Supply / Demand
Variability
Variability
Safety Inventory
Safety Inventory
Cost Efficiency
Cost
Efficiency
Responsiveness
Responsiveness

Economies of

Scale Cycle Inventory
Scale
Cycle Inventory
Seasonal
Seasonal
Variability Seasonal
Variability
Seasonal

Inventory

Warehousing

Traditionally viewed as

a place to hold or store inventory

Contemporary view is

the warehouse

functions to mix inventory arrangements to meet customer

requirements

Storage of products is held to a minimum

Warehousing • Traditionally viewed as a place to hold or store inventory • Contemporary view is

Warehouse management

Warehouse management Figure 10.1 Consolidation and Break-Bulk Arrangements

Figure 10.1 Consolidation and Break-Bulk Arrangements

Warehouse operations involve two major activities handling and storage

Objective is to

Efficiently receive inventory Store it as required Assemble it into complete orders Make a customer shipment

Operations will

therefore emphasize

product flow

Warehouse operations involve two major activities – handling and storage • Objective is to – Efficiently
Warehouse operations involve two major activities – handling and storage • Objective is to – Efficiently

Handling

Handling must optimize movement continuity and efficiency

ReceivingUnloading the arriving vehicles

In-Storagemoving goods for storage (transfer) or order selection (picking)

Shippingverifying the order and loading the departing vehicles

Handling • Handling must optimize movement continuity and efficiency – Receiving — Unloading the arriving vehicles
Handling • Handling must optimize movement continuity and efficiency – Receiving — Unloading the arriving vehicles

Storage plans should make product velocity a major factor

Slotting determines specific locations for the product based on

Velocityhow fast the goods move

Weighthow heavy is the product

Special Characteristicshow large or small, does

it require rack or bin storage

Storage plans should make product velocity a major factor • Slotting determines specific locations for the

Warehouse management

Inventory accuracy is typically maintained by annual physical

counts or counting portions of inventory on a planned basis

Cycle counting is the audit of selected inventory on a cyclic schedule

Audits are common to maintain safety, assure compliance to regulations and help improve

procedures

Security issues involve protection from pilferage and damage

Warehouse management • Inventory accuracy is typically maintained by annual physical counts or counting portions of
Warehouse management • Inventory accuracy is typically maintained by annual physical counts or counting portions of

Warehouse management

Accident prevention

Comprehensive safety programs and training, accident investigation and follow up

Environmental protection

Spill ( leak ) kits and spill plans

Maintenance

Scheduled maintenance of building, material handling equipment, and collision damage prevention

Warehouse management • Accident prevention – Comprehensive safety programs and training, accident investigation and follow up
Warehouse management • Accident prevention – Comprehensive safety programs and training, accident investigation and follow up

Unitization

It is the process of consolidation of several units

into single unit. It is made of a number of items or a bulky material and is constrained to lifted and shifted because it is too bulky to be moved

manually. Material handling cost decreases as the

size of the unit increases.

Using a carton would be more economical than lifting items individually and combining several

cartons into a unit load would be even more

economical.

Unitization Example

At the time of transferring the purchased components in the car we do not keep them individually we place them in a bag. Similarly

unit loads are used in the industry .Pallet is an

example of a unit load device usually has a

dimension of 48”X40”X4” designed so that

several packages are placed on it. Several such

packages form a unit cube.

Role

inspecting, packing, palletizing and loading