2-2-12 Distribution

StudyBlue printing of 2-2-12 Distribution html, body, div, span, applet, object, iframe, h1, h2, h3, h4, h5, h6, p, blockquote, pre, a, abbr, acronym, address, big, cite, code, del, dfn, em, font, img, ins, kbd, q, s, samp, small, strike, strong, sub, sup, tt, var, b, u, i, center, fieldset, form, label, legend, table, caption, tbody, tfoot, thead, tr, th, td { margin: 0; padding: 0; border: 0; outline: 0; font-size: 100%; background: transparent; } body { line-height: 1; } blockquote, q { quotes: none; } blockquote:before, blockquote:after, q:before, q:after { content: ''; content: none; } /* remember to define focus styles! */ :focus { outline: 0; } /* remember to highlight inserts somehow! */ ins { text-decoration: none; } del { text-decoration: line-through; } /* tables still need 'cellspacing="0"' in the markup */ table { border-collapse: collapse; border-spacing: 0; } /* end RESET */ .header { min-width:800px; } .logo { padding:6px 20px 2px 20px; margin:0; font-size:25px; font-weight:bold; color:#808285; position:relative; border-bottom: 1px solid #c5c5c5; } .logo-blue { color:#70adc4; } .logo-desc { font-weight:normal; font-size:19px; color:#cccccc; margin-top:50px; position:absolute; display: none; } .back-button { position:absolute; top:20px; right:20px; font-size:13px; line-height:25px; color:rgb(0,175,225); font-weight:normal; } .back-button a { color:rgb(0,175,225); } .instructions { padding:0; margin:0; width:100%; position:relative; color:rgb(100,100,100); } .step-holder { border-left:1px solid #ededed; margin-left:20px; } .steps { padding:15px 0; float:left; width:24%; border-right:1px solid #ededed; text-align:center; } .steps-01 { } .steps-02 { } .steps-03 { } .steps-04 { } .label { padding:5px 10px; } .print-button { } .print-button a { background-color:rgb(0,175,225); color:white; line-height: 19px; padding:9px 8px 5px 30px; font-size:14px; text-decoration:none; background-image: url(images/printer.png); background-repeat: no-repeat; background-position: 7px 50%; -moz-border-radius: 5px; -webkit-border-radius: 5px; } .print-button a:hover { background-color:black; } .theNote .content { width: 8.0in !important; margin: 5px auto; padding:20px; background-color:white; } .theNote .header { border-bottom: 1px dashed #C8C8C8; font-size: 17px; padding: 0 0 10px; line-height: 19px; color: #00ADE1; min-width:500px; } .theNote .body { font-size: 14px; line-height: 19px; padding: 10px 0; } .theNote{ padding:6px 0; clear:both; background-color: rgb(200,200,200); } .theNote h3{ color: rgb(100,100,100); } .theNote h1, .theNote h3{ background-color:white; padding:2px 20px; width:8.0in !important; margin: 0 auto; font-size: 15px; } .theNote h1{ padding-top: 10px; font-size: 15px; } .theNote h1:first-child{ font-size: 20px; } .theNote h3 { font-size: 14px; font-weight: normal; } #options { border: 3px double #ccc; padding: 5px 12px; margin: 10px 50px 10px 20px; float: left; } #info { border-top: 1px solid #ccc; padding-top: 5px; font-style: italic; } li { margin: 5px 10px 5px 25px; } ul li { list-style: disc; } ol li { list-style: decimal; } img { border: 0; } table { clear: both; width: 100%; border: 1px solid #c5c5c5; border-width: 1px 0; margin: 0; page-break-after: always; } table#page { page-break-after: auto; } td { text-align: center; font-size: 12px; border-bottom: 1px dashed #c5c5c5; height: 1.75in; width: 50%; padding-left: 15px; } .leftside { border-right: 1px solid #cccccc; padding: 0 15px 0 0; } .bottom td { border-bottom: none; } .clearfix { clear:both; line-height:1px; height:1px; } img { max-width:80%; max-height:150px; margin:20px; } @media print {.header { display: none; } .content .header{ display:inherit; } table { border: 1px dashed #bbb; border-width: 1px 0; } .theNote{ background-color:white; } } 2-2-12 Distribution Transportation facts- air is expensive; you would want to only ship anything that is critical and has a larger value Ocean is the cheapest form of transportation out of air,truck,train,pipeline Water & pipeline are decreasing Barge- negative could be that you can't go everywhere with it; some form of transportation still has to take place to get loaded and unloaded on the dock; more handling involved but it can be still cost efficient; have to work with the numbers Designing a supply chain network - people, plant, profit (3P's of supply chain); if you focus on those three you will be ok The Role of Distribution in the Supply Chain- What is it? - refers to steps taken to move and store a product from the supplier stage to the customer stage in a supply chain Distribution-related cost - make up about 10.5% of the US economy and about 20% of the cost of the manufacturing Mall in Hawaii- you got what are called anchor stores such as Sear's,Macy's etc.; trucks take product to the retailer; they have 3 docks; how does it get to the stores; it gets to them internally with a back alley India - large population- 30 + cities have populations of more than 1 million but nearly 70% still live in rural areas; Retail Density- more than 15 million retail outlets; mom-and-pops stores account for more than 96% of the total market for many markets, organized retail represents only 4%; Infrastructure complexity- very few full-service distribution companies operate in India Every states in India have thing called boarder-crossing & get charged tax; most of the transport happens at night; another mean of transportation is three wheeler India is becoming one of the world's largest markets for consumer goods and rapidly rising household incomes ; Wal-Mart is teaming up with Bharti to establish wholesale and supply chain operations in India- they can not just got and set up stores there. They must partner up with a business. Factors Influencing Distribution Network Design - 1) Customer needs that are met (customer service); response time, product variety (the probability of having the product in-stock), customer experience (evaluation forms, tracking, promotions), order visibility (ability of customers to track their orders), Returnability ( able to make returns easy) 2) cost of meeting customer needs (supply chain cost), inventory (where is it on balance sheet under asset), transportation, facility and handling, information Response Time and Number of Facilities- if response time gets larger it takes a longer time to get what you want and the relationship with facilities it has higher Facility Cost and NUmber of Facilities - as facility cost goes up the number of facilities higher Inventory Cost and number of facilities as inventory costs go up your number of facilities are up too Transportation cost and number of facilities the number of facilities low the higher transportation cost ; if you have on facility transporting out to many places it is going to be high And you add all these together it gets you the total logistics costs These curves change based on business and the way you run but these are the conceptually what will happen Design Options for a distribution network - two key decisions when designing a distribution network will the product be delivered to customer or picked up Manufacturer storage withe direct shipping and in-transit merge- Ex: Dell; shipped via 3rd party logistics ; Dell ships the computer and Sony ships the monitor and UPS is responsible of the merging of the shipments Manufacturer Storage with Direct Shipping (Drop Shipping)- allows the manufacturer the opportunity to postpone customization; effective for high value, large variety, low demand products and high transportation cost Manufacturer storage with direct shipping and in-tranist merge- shipments from multiple manufactures are merged before making a single delivery to the consumer ; shipments to mergers are larger so economies of scale is achieved ; merged increase facility cost and response time may go up as well; exmaple: furnitures retailers merge couches & coffee tables produced by different manufacture; Dell is another example Distributor Storage with Carrier Delivery- inventory is held at a warehouse which ships to customer by 3P carries or their own; with respect to directly shipping inventory aggregation is less; higher inventory costs; warehouses are physically close to consumer which leads to faster responses time and lower transportation; not effective for slow moving; Example: Amazon Distributor Storage with last Mile Delivery- warehouse delivers to customers instead of carrier ; warehouses are located closer to consumer; Example: gallery furniture ; has drivers that are different parts of the town; they take the drivers make delivery at the end of the night and the works go home and then they come next morning to work bring truck back; Mile delivery, Sisco, Grocery delivery (Peapod, Albertsons) From Brick and morter to click and morter- distributor takes products from multiple manufactures and then takes to the retailers