designing the distribution network in a supply chain 【本著作除另有註明外，採取創用...

Designing the Distribution Network in a Supply ChainDesigning the Distribution Network in a Supply Chain

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第十二單元 (3) ： Designing the Distribution Network in a Supply Chain

【本著作除另有註明外，採取創用 CC

「姓名標示－非商業性－相同方式分享」台灣3.0

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第十二單元 (3) ： Designing the Distribution Network in a Supply Chain

蔣明晃教授

1

http://creativecommons.org/licenses/by-nc-sa/3.0/tw/










http://en.wikipedia.org/wiki/Public_domain

OutlineOutline

► The Role of Distribution in the Supply Chain► Factors Influencing Distribution Network Design► Design Options for a Distribution Network► The Value of Distributors in the Supply Chain► Distribution Networks in Practice

2

The Role of Distribution in the Supply Chain

The Role of Distribution in the Supply Chain

► Distribution: the steps taken to move and store a product from the supplier stage to the customer stage in a supply chain

► Distribution directly affects cost and the customer experience and therefore drives profitability

► Choice of distribution network can achieve supply chain objectives from low cost to high responsiveness

► Examples: Wal-Mart, Dell, Proctor & Gamble, Grainger

Wikipedia

3

Factors InfluencingDistribution Network Design


► Distribution network performance evaluated along two dimensions at the highest level:》Customer needs that are met》Cost of meeting customer needs

► Distribution network design options must therefore be compared according to their impact on customer service and the cost to provide this level of service

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► Elements of customer service influenced by network structure:

》Response time

》Product variety

》Product availability

》Customer experience

》Order visibility

》Returnability

PZB 為 Parasuraman, Zeithaml 和 Berry（簡稱 PZB ）三位學者於 1985 年所提出的服務品質衡量模式

► Supply chain costs affected by network structure:

》 Inventories

》Transportation

》Facilities and handling

》 Information

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Service and Number of FacilitiesService and Number of Facilities

Number of Facilities

Response Time

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► Elements of customer service influenced by network structure:

》Response time

》Product variety

》Product availability

》Customer experience

》Order visibility

》Returnability

► Supply chain costs affected by network structure:

》 Inventories

》Transportation

》Facilities and handling

》 Information

7

Service and Number of FacilitiesService and Number of Facilities


Response Time

8

Inventory Costs and Numberof Facilities

Inventory Costs and Numberof Facilities

Inventory Costs

Number of facilities

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Transportation Costs andNumber of Facilities

Transportation Costs andNumber of Facilities

TransportationCosts


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Facility Costs and Number of Facilities

Facility Costs and Number of Facilities

FacilityCosts


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Total Costs Related to Number of Facilities

Total Costs Related to Number of Facilities

To

tal

Co

sts


Total CostsTotal Costs

Inventory

Transportation

Facilities

12

Response TimeResponse Time

Variation in Logistics Costs and Response Time with Number of Facilities

Variation in Logistics Costs and Response Time with Number of Facilities


Total Logistics CostsTotal Logistics Costs

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Design Options for a Distribution NetworkDesign Options for a Distribution Network

► Manufacturer Storage with Direct Shipping► Manufacturer Storage with Direct Shipping and In-Transit

Merge► Distributor Storage with Carrier Delivery► Distributor Storage with Last Mile Delivery► Manufacturer or Distributor Storage with Consumer

Pickup► Retail Storage with Consumer Pickup► Selecting a Distribution Network Design

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Manufacturer Storage with Direct Shipping


Manufacturer

Customers

Product Flow

Information Flow

Retailer

本作品轉載自Microsoft Office 2007多媒體藝廊，依據 Microsoft 服務合約及著作權法第 46 、 52 、 65條合理使用。



Cost Factor Performance

Inventory Lower cost because of aggregationLow demand high value; product customization can be postponed

Transportation High cost due to long distance and disaggregate shipping

Facilities and handling Lower facility cost; handling cost may lower if small shipment can be managed

Information Significance investment in infrastructure to integrate the supplier and buyers

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Service factor Performance

Response time High response time, complicated receiving

Product variety Easily provide high level variety

Product availability

Easily provide high level product availability

Customer experience

Good as home delivery but suffer as partial shipment from different suppliers

Order visibility More difficult but more important

Returnability Expensive and difficult to implement

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In-Transit Merge Network

In-Transit Merge Network

Factories

Retailer

Product Flow

Information Flow

In-Transit Merge by Carrier

Customers

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In-Transit Merge NetworkIn-Transit Merge Network


Inventory Similar to drop-shipping

TransportationLower than drop-shipping

Facilities and handling Receiving cost lowers at customer; handling cost are higher drop-shipping

Information Investment is higher than drop-shipping

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In-Transit Merge NetworkIn-Transit Merge Network


Response time Similar to drop-shopping; may be higher

Product variety Similar to drop-shopping


Similar to drop-shopping

Customer experience

Better than drop-shopping because of single delivery

Order visibility Similar to drop-shopping

Returnability Similar to drop-shopping

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Distributor Storage with Carrier Delivery


Factories

Customers

Product FlowInformation Flow

Warehouse Storage by Distributor/Retailer

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Inventory Higher than manufacturer storage. Difference is not large for faster moving items

Transportation Lower than manufacturer storage. Reduction is higher for faster moving items

Facilities and handling Higher than manufacturer storage. Difference is large for slow-moving items

Information Simple infrastructure

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Response time Faster than manufacturer storage

Product variety Lower than manufacturer storage


Higher cost to provide the same level of product availability as manufacturer storage

Customer experience

Better than manufacturer storage with drop-shipping

Order visibility Easier than manufacturer storage

Returnability Easier than manufacturer storage

23

Distributor Storage with Last Mile Delivery


Factories

Customers

Product Flow

Information Flow

Distributor/Retailer Warehouse

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Inventory Higher than distributor storage with carrier delivery

Transportation Very high cost given minimal scale economies. Higher than any other distribution option.

Facilities and handling Higher than manufacturer storage or distribution with carrier delivery, but lower than a chain of retail stores.

Information Similar to distributor storage with carrier delivery

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Response time Very quick. Same day to next day delivery.

Product variety Easily provide high level variety


Less than distributor storage with carrier delivery but larger than retail stores.

Customer experience

Very good, particularly for bulky items.

Order visibility Easier to implement than manufacturer storage or distributor storage with carrier delivery

Returnability Easier to implement than other options. Harder and more expensive than a retail network.

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Manufacturer or Distributor Storage with Customer PickupManufacturer or Distributor

Storage with Customer Pickup

Factories

Retailer

Pickup Sites

Product FlowInformation Flow

Cross Dock DC

Customer Flow

Customers

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Inventory Can match other options depending on the location of inventory

Transportation Lower than the use of package carriers, especially if using an existing delivery network

Facilities and handling Facility cost will be very higher if new facilities need to be built. The increase in handling cost at the pickup site is significant.

Information Significance investment in infrastructure required

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Response time Similar to carrier delivery with manufacturer or distributor storage. Same day delivery possible for items stored locally at pickup site

Product variety Similar to other manufacturer or distributor storage options


Similar to other manufacturer or distributor storage options

Customer experience

Lower than other options. In high density area loss of convenience may be small

Order visibility Difficult but essential

Returnability Somewhat easier given that pickup location can handle returns

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Retail Storage at Consumer Pickup Sites



Inventory Higher than all other options

Transportation Lower than all other options

Facilities and handling Higher than all other options The increase in handling cost at the pickup site is significant for online and phone orders.

Information Some investment in infrastructure required for online and phone orders.

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Response time Same day pickup possible for items stored locally at pickup site

Product variety Lower than all other options


More expensive to provide than all other options.

Customer experience

Related to whether shopping is viewed as a positive or negative experience by customer.

Order visibility Trivial in-store orders. Difficult, but essential, for online and phone orders.

Returnability Easier than other options given that pickup location can handle returns

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Comparative Performance of Delivery Network Designs

Comparative Performance of Delivery Network Designs

Information

Facility & Handling

Transportation

Inventory

Returnability

Order Visibility

Customer Experience

Product Availability

Product Variety

Response Time

Manufacturer storage with

pickup

Distributor storage with last

mile delivery

Distributor Storage with Package Carrier

Delivery

Manufacturer Storage with In-Transit Merge

Manufacturer Storage with

Direct Shipping

Retail Storage with Customer

Pickup

1

1

1

1

1

1

1

1

1

1

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55

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5

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Linking Product Characteristics and Customer Preferences to Network Design

Linking Product Characteristics and Customer Preferences to Network Design

Low customer effort

High product variety

Quick desired response

High product value

Many product sources

Very low demand product

Low demand product

Medium demand product

High demand product

Manufacturer storage with

pickup

Distributor storage with last

mile delivery

Distributor Storage with

Package Carrier Delivery


In-Transit Merge


Direct Shipping

Retail Storage with Customer

Pickup

+2

+2

+2

+2

+2

+2

+2 +2 +2

+2

+1

+1

+1

+1

+1

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+1

+1

+1

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+1

0

0

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-2 -2

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The Value of Distributors in the Supply Chain


► Distributing Consumer Goods in India:

》Lower transportation cost and improve replenishment response time

► Distributing MRO Products:

》Order unplanned, a few items with lower value

》Aggregate safety inventory and consolidate outbound shipment

► Distributing Electronic Components:

》Move components from manufacturers to small OEMs.

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► Reduce inbound cost► Reduce outbound cost► Reduce safety stock and inventory costs► Stable order to manufacturers to allow effective

production planning► Provide better response time► Offer one-stop shopping with products from several

manufacturers

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Distribution Networks in Practice

Distribution Networks in Practice

► The ownership structure of the distribution network can have as big as an impact as the type of distribution network

► The choice of a distribution network has very long-term consequences

► Consider whether an exclusive distribution strategy is advantageous

► Product, price, commoditization, and criticality have an impact on the type of distribution system preferred by customers

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3Wikimedia Commons本作品轉載自 http://commons.wikimedia.org/wiki/File:Dell_Logo.png，瀏覽日期 2011/12/28。

15 本作品由「東森得意購股份有限公司」授權使用，您如需利用本作品，請另行向權利人取得授權。

15 本作品轉載自Microsoft Office 2007多媒體藝廊，依據Microsoft 服務合約及著作權法第 46 、 52 、 65條合理使用。

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