SCM Class Final Ppt

8/8/2019 SCM Class Final Ppt

1/24

APPROACHESAPPROACHES

ININLOGISTICSLOGISTICS

MANAGEMENTMANAGEMENT

PRESENTED BY:

NIKITAROLL NO. 24

TRIMESTER-4RETAIL MANAGEMENT


2/24

Essentials of a Vendor(Supplier)Essentials of a Vendor(Supplier)


3/24

VendorVendor- -managed inventorymanaged inventoryVendor-managed inventory (VMI) is a business model in which the

buyer of a product provides certain information to a supplier of that product and the supplier takes full responsibility for maintaining anagreed inventory of the material, usually at the buyer's consumptionlocation (usually a store).

y No stock outy Reduced inventory in the supply chainy Product display, familiarity with product line, cleaning and organizing

product lines

Ex amples- W al-Mart ,Oil companies to manage the gasolineinventories at the service stations that they supply ( PetrolsoftCorporation) ,Home Depot (i.e. Moen, Delta, RIDGID, Paulin).


4/24

y Sh ared risk if the inventory does not sell by repurchasing from the buyer (retailer)

y H ousing products U ntil the sale takes place in exchange for a predetermined commission or profit

y Vendors benefit from more control of displays and more contact to impart

knowledge on employees

y R etailers benefit from reduced risk, better store staff knowledge (which builds brand loyalty) and reduced display maintenance outlays

y C onsumers benefit from knowledgeable store staff when parts or serviceare required, and therefore the ability to help the customer choose amongstcompeting products for items most suited to them


5/24

Q uick response manufacturingQ uick response manufacturingy Reducing internal and external lead times to serve customers better and

faster byImprove qualityReduce cost

Eliminate non-value-added wasteIncreasing competitiveness and market share

y T he time-based framework offers custom-engineered products whileeliminating rework and changing due dates.

y U sed by companies making products in low or varying volumes tocomplement strategies such as Lean Manufacturing, T otal qualitymanagement, Six Sigma or Kaizen.


6/24

Sh ort lead times t h e yardstick for organizational success

y Waste such as excessive forecasting, planning, scheduling, expediting, work in progress ( W IP), finished goods costs and obsolescence= Increase overall costs andlower competitiveness.

y Products and product orders require long routes through numerous departmentsy Hierarchical communication require a significant amount of time to resolve issuesy F ocus on efficiency and resource utilization encourages workers and managers to

build backlogsy Minimizing costly machine setups, workers resort to running large batc h sizesy Making large product quantities to stock high inventory, prone to inventory

obsolescencey Low skill levels lead to low quality and h igh levels of rework

Reducing lead times results in improvements in both quality and cost. Eliminatingthe time-consuming and often self-reinforcing practices can lead to large costsavings while improving product quality and customer responsiveness


7/24

Merge in transitMerge in transity Merge in transit is a situation in which goods from multiple sources for

an order (a companys own factories, outside suppliers, etc.) are sent to adistribution centre, where they are consolidated for shipment.

y Can operate on an international basis, in which bulk shipments fromdifferent sources are merged and sent to customers, such as large reseller channels, as one shipment.

Example-Personal computers, where the manufacturer needed to mixlocally-produced PC towers with monitors, keyboards, printers, and other accessories produced by other companies.

K ey C h allenges- T iming, synchronization and proximity of storage areasto receiving/shipping


8/24


9/24

Build to orderBuild to ordery B uild to Order is a demand driven production approach where a product is

scheduled and built in response to a confirmed order received for it from afinal customer and not the intermediaries in the supply chain.

y A BT O system does not mean that all suppliers in the supplier chain should be producing only when a customer order has been confirmed. It isappropriate that these should be identified and built to a supplier order.

y F or highly configured products, e.g. Automobiles , computer servers, or for

products where holding inventories is very expensive, e.g. Aircraft.


10/24

y A dvantages in environments of high product variety is

Ability to supply exact product specificationReduction in sales discounts and finished good inventoryReduction in stock obsolescence risk

y D isadvantage

Market demand fluctuations leading to a reduced capacity

utilization in manufacturing


11/24

Th irdTh ird- -party logisticsparty logistics

y A th ird-party logistics provider (3PL/TPL ) is a firm that provides a onestop shop service to its customers of outsourced (or "third party") logisticsservices for part, or all of their supply chain management functions.

y Specialize in integrated operation, warehousing and transportation servicesthat can be scaled and customized to customers needs based on marketconditions and the demands and delivery service requirements for their

products and materials.


12/24

y Types of 3PL :1 . F reight forwarders

2. Courier companies3. Other companies integrating & offering subcontracted logistics and

transportation services

y F our categories of 3PL providers are :

1. Standard 3PL provider: Pick and pack, warehousing, and distribution2. Service developer: advanced value-added services such as : tracking and

tracing, cross-docking, specific packaging, or providing a uniquesecurity system.

3. The customer adapter: T akes over complete control of the companys

logistics activities. Improves logistics dramatically.4. The customer developer: Wh en the 3PL provider integrates itself with the

customer and takes over their entire logistics function


13/24

Terminologyy 1 PL, which are the shipper or the consigneey 2PL, which are actual carriers such as YRC W orldwide, U PS, F edExy 4PL, which are consulting firms such as CPCS, SCMO, B MT ,

Deloitte, and Accenture

Overlapping

y 3PL can also be 2PL at the same time in the following cases :y when a shipping line owns a freight forwarder y when an airline owns a general sales agent (GSA)y when a freight forwarder owns trucks or a warehouse,y when a courier company owns planes


14/24

Electronic Data Interc h angeElectronic Data Interc h angey It is the structured transmission of data between organizations by electronic

means. It is used to transfer electronic documents or business data from onecomputer system to another computer system, i.e. from one trading partner to another trading partner without human intervention.

A dvantages of using E D I over paper systemsy Save money by providing alternatives to paper documents, meetings, faxes,

etc.y Storing and manipulating data electronically without the cost of manual

entry.y Reduced errors, such as shipping and billing errorsy Speed in which the trading partner receives and incorporates the

information


15/24

C ollaborative planning,C ollaborative planning,forecasting, and replenis h mentforecasting, and replenis h ment

y CP F R to enhance supply chain integration by supporting and assisting joint practices.

y

CPF

R seeks cooperative management of inventory through joint visibilityand replenishment of products throughout the supply chain.

y Continuous updating of inventory and upcoming requirements, planningand satisfying customer demands making the end-to-end supply chain

process more efficient.

y Decrease expenditures for merchandising, inventory, logistics, andtransportation across all trading partners.


16/24

y T he 9 steps in CP F R :1

. DevelopF

ront End Agreement2. Create the Joint B usiness Plan3. Create the Sales F orecast4. Identify Exceptions for Sales F orecast5. Resolve/Collaborate on Exception Items6. Create Order F orecast7. Identify Exceptions for Order F orecast8. Resolve/Collaborate on Exception Items9. Order Generation

y Example- W al-mart


17/24

J ustJ ust- -inin--timetime

J ust-in-time (J IT ) is an inventory strategy that strives toimprove a business's return on investment , quality andefficiency by reducing in-process inventory and associatedcarrying costs.

Just In T ime production method is also called the T oyotaProduction System. T o meet JI T objectives, the process relieson signals or Kanban between different points in the process,which tell production when to make the next part.Kanban are usually 'tickets' but can be simple visual signals,such as the presence or absence of a part on a shelf.


18/24

B enefits

y Reduced setup time.y T he flow of goods from warehouse to shelves improvesy Employees with multiple skills are used more efficiently.y Production scheduling and work hour consistency

synchronized with demandy Increased emphasis on supplier relationshipsy Supplies come in at regular intervals throughout the

production day


19/24

Track & TraceTrack & Trace

y Process of determining the current and past locations (andother information) of a unique item or property.

y T his concept can be supported by means of reckoning andreporting of the position of vehicles and containers with the

property of concern, stored, for example, in a real-timedatabase.

y Another approach is to report the arrival or departure of theobject and recording the identification of the object, the

location where observed, the time, and the status.


20/24

y Radio-frequency identification and barcodes are two common

technology methods used to deliver traceability.

y R F ID is a code-carrying technology, and can be used in placeof a barcode to enable non-line of sight-reading

y Some produce traceability makers use matrix barcodes torecord data on specific produce.

y B ar-coding is a common and cost effective method used toimplement traceability at both the item and case-level.


21/24

C rossC ross- -dockingdockingy Cross-docking is a practice in logistics of unloading

materials from an incoming transport unit and loading thesematerials in outbound transport unit, with little or no storagein between.

y T his may be done : To change type of conveyanceor T o sort material intended for different destinations,or T o combine material from different origins.

In purest form this is done directly, with minimal or nowarehousing.


22/24


23/24

B enefits

y

Simplify receiving at the retail outletsy Reduced cost of unloading and handlingy Consolidation of several delivery destinations bound to the same

geographical areay High transport frequency (small lead times)y Reduction of queues and delaysy W arehousing costs dramatically decreasesy Reductions in storage-space requirementsy Less equipment required for handling and storing the productsy Reductions in inventory investmenty High reactivity -ability to avoid some stock outsy No constraints concerning expiry datesy Less excess inventory generates reduced product damages and product

obsolescence


24/24

Thank

You

for

attention!

SCM Class Final Ppt

Documents