Location,Logistics,andDistribution.pptVIP

Location, Logistics, and Distribution CHAPTER 12 Learning Objectives Describe what a third-party logistics provider is. Assess the major issues that need to be considered in locating a plant or warehouse facility. Understand the centroid method for locating entities such as cell phone communication towers. Know how a factor-rating system can be used to narrow potential location sites. Logistics Logistics: the art and science of obtaining, producing, and distributing material and product in the proper place and in proper quantities International logistics: managing these functions when the movement is on a global scale Third-party logistics company: an outside company used to handle logistics functions LO 1 Decisions Related to Logistics How material will be transported Truck: great flexibility Ship: high capacity and low cost but slow Plane: fast but expensive Train: low cost but slow and variable Pipeline: highly specialized and limited to liquids, gases, and solids in slurry form Hand delivery: last step in many supply chains Multimodial solutions are the norm LO 2 Logistics-System Design Matrix LO 2 Cross-Docking Cross-docking: large shipments are broken down into small shipments for local delivery in an area Minimizes inventory in the warehouse Hub-and-spoke systems: the sole purpose of the warehouse (the hub) is sorting goods to consolidation areas, where each area is designed for shipment to a specific location LO 2 Issues in Facility Location Proximity to customers: makes rapid delivery easier Business climate: can include presence of similar-sized businesses, businesses in the same industry, and other foreign companies Total costs: object is to minimize overall cost Infrastructure: adequate road, rail, air, and sea transportation along with energy and telecommunications LO 2 Issues in Facility Location Continued Quality of labor: educational and skill levels must match needs Suppliers: proximity of important suppliers supports lean production Other facilitie