2. LEARNING OBJECTIVES:UNDERSTAND LOGISTICS STRATEGY.
UNDERSTAND LOGISTICS PLANNING.
UNDERSTAND FASCILITIES PLANNING.
DISCUSS INVENTORY MANAGEMENT STRATEGY.
KNOW THE MAIN ISSUE IN TRANSPORTATION.
3. DEFINITION :-THAT PART OF SUPPLY CHAIN PROCESS THAT PLANS,IMPLEMENTS
AND CONTROLS THE EFFICIENT , EFFECTIVE FLOW AND STORAGE OF GOODS, SERVICES,
AND RELATED INFORMATION FROM THE POINT OF CONSUMPTION IN ORDER TO MEET
CUSTOMERS’S REQUIREMENT
4. OBJECTIVES :Cost reduction:- Aimed at reducing the variable cost related to the movement and storage
of goods.
Capital Reduction:-Means to maximize the return on investment.
Service Improvement:-Giving better service without increasing the cost of logistics.
LOGISTIC PLANINGS:It tackles four major problems areas: 1.Customer service levels:-
INVENTORY
MANAGEM
ENT
2.Facility Planning:-for storing & supplying the product.
LOCATION
TRANSPORT
e.g warehousing(why,where,how many)
ATION
DECISION
DECISIONS
3.Inventory Management.
S
Managing those stocks or items used to support production
CUSTOMER
,supporting activities activities and custumer service
SERVICE
GOALS
NEED OF INVENTORY:IMPROVE CUSTOMER SERVICE,
SMOOTHENS THE OPERRATION OF THE LOGISTICS SYSTEM,
REDUCE COST.
OBJECTIVES OF INVENTORY MANAGEMENT:-TO INCREASE THE FILL RATE(LINE FILL RATE AND
ORDER FILL RATE)
5. LFR= Total no. of units received
Total no. of units ordered
OFR=Total SKU categories for which 100% order received
,
Total no. of SKU categories ordered
COSTS ASSOCIATED WITH INVENTORY :INVENTORY PROCUREMENT COST
INVENTORY CARRYING COST:CAPITAL COST
ICC
INVENTORY COST
STORAGE CAPACITY
INVENTORY INVESTMENT
INSURANCE AND TAXES
WAREHOUSE RENT,MAINTENANCE CHARGE
OBSOLESCENCE
DAMAGE AND PILFERAGE
INVENTORY CARRYING COST
SHRINKING
RELOCATION COST
6. 4)Transportation Decisions.
WHICH MODE,
WHICH ROUTE,
FREIGHT CONSOLIDATION
FACTORS AFFECTING TRANSPORTATION COSTS:PRODUCT RELATED FACTOR :The density of the product.
Stow ability.
The ease or difficulty in handling
Liability
MARKET RELATED FACTOR:Intermode or intramode competitor
Locations.
Balance between in freight and out freight
Seasonability of the product movement
