International Logistics Management

Transcription

1 International Logistics Management Definition- Logistics is the process of planning, implementing, and controlling the efficient, effective flow and storage of raw materials, work-in-progress inventory, finished goods, and the related services and information originating from a firm s tiers of vendors and culminating with it s ultimate customers. Seven Rs - right product, right quantity, right condition, right place, right time, right customer, right price Logistics Network Vendors Plants Distribution Centers Customers Vorravee Pattaravongvisut

2 What is a Distribution Channel? A set of interdependent organizations (intermediaries) involved in the process of making a product or service available for use or consumption by the consumer or business user. Channel decisions are among the most important decisions that management faces and will directly affect every other marketing decision.

3 Distribution Channel Functions Risk Taking Information Financing Promotion Physical Distribution Contact Negotiation Matching

4 Consumer Marketing Channels & Levels Channel Level - A Layer of Intermediaries that Perform Some Work in Bringing the Product and it s Ownership Closer to the Buyer. Channel 1 MM Channel 2 ฎ Direct Indirect MM R R C C Channel 3 MM W W R R C C Channel 4 MM ฎ W ฎ J ฎ R ฎ C ฎ ฎ C C

5 Channel Behavior & Conflict The channel will be most effective when: each member is assigned tasks it can do best. all members cooperate to attain overall channel goals and satisfy the target market. When this doesn t happen, conflict occurs: Horizontal Conflict occurs among firms at the same level of the channel. Vertical Conflict occurs between different levels of the same channel. For the channel to perform well, conflict must be managed.

6 Types of Vertical Marketing Systems Greater Corporate Common Ownership at at Different Levels of of the Channel Degree of of Direct Control Lesser Contractual Contractual Agreement Among Channel Members Administered Leadership is is Assumed by One or or a Few Dominant Members

7 Vertical Marketing Systems Vertical Marketing Systems (VMS) Corporate VMS Contractual VMS Administered VMS Wholesaler Sponsored Voluntary Chain Retailer Cooperatives Franchise Organizations Manufacturer- Sponsored Wholesaler Franchise System Manufacturer- Sponsored Retailer Franchise System Service-Firm- Sponsored Franchise System

8 Channel Design Decisions Analyzing Consumer Service Needs Setting Channel Objectives & Constraints Identifying Major Alternatives Intensive Distribution Selective Distribution Exclusive Distribution Evaluating the Major Alternatives

9 Provide a Targeted Level of Customer Service at the Least Cost. Maximize Profits, Not Sales. Higher Distribution Costs/ Higher Customer Service Levels Lower Distribution Costs/ Lower Customer Service Levels

10 Logistics Systems Costs Minimize Costs Costs of of Attaining Logistics Objectives Order Processing Submitted Processed Shipped Transportation Water, Truck, Rail, Pipeline & Air Logistics Functions Warehousing Storage Distribution Inventory When When to to order order How How much much to to order order Just-in-time

11 Transportation Modes Rail Nation s largest carrier, cost-effective for for shipping bulk bulk products, piggyback Truck Flexible in in routing & time time schedules, efficient for for short-hauls of of high value goods Water Low Low cost cost for for shipping bulky, low-value goods, slowest form Pipeline Ship petroleum, natural gas, gas, and and chemicals from sources to to markets Air Air High cost, ideal when speed is is needed or or to to ship ship high-value, low-bulk items

12 Choosing Transportation Modes Checklist for Choosing Transportation Modes 1. Speed. 2. Dependability. 3. Capability. 4. Availability. 5. Cost.

13 Integrated Logistics Management Concept Recognizes that Providing Better Customer Service and Trimming Distribution Costs Requires Teamwork, Both Inside the Company and Among All the Marketing Channel Organizations. Cross-Functional Teamwork inside the Company Building Channel Partnerships Third-Party Logistics

14 Supply Chain Activities Demand Forecasting Order Processing Procurement Plant and Warehouse Site Location Warehousing and Storage Traffic and Transportation Production Planning Materials Handling Inventory Control Customer Service Industrial Packaging Distribution Communications Return Goods Handling Parts and Service Support Salvage and Scrap Disposal

15 Supply Chain Management SCM entails managing the flow of material and information in a sequence beginning with supplier and ending with customers. For the purpose clarity and transparency the SCM sequence is often broken up into smaller segments beginning with inbound logistics (materials management), followed by operational logistics which concerns the issues while the goods are being produced, and ending with outbound logistic (customer service and distribution channels)

16 Materials Management Functions Materials management concerns the planning and control of inbound materials, the work-in-process, and the storage of the finished goods. Typical activities include the following: Materials planning and control Procurement Transportation Material receiving Inbound quality control Inbound warehousing Production planning and control Outbound quality control Outbound warehousing Salvage and scrap disposal

17 Procurement Activities Needs analysis Define user requirements Make or buy analysis Identify type of purchase (rebuy, modified rebuy, new buy) Market analysis on supply source Generate supplier list Prescreen suppliers Evaluate suppliers Select supplier Delivery and performance measurement Performance evaluation

18 Vendor Selection Criteria Necessary Criteria Quality Reliability Capability Financial considerations Desirable Criteria Location Reputation Training Support Final selection of vendors can be facilitated by scoring vendors based on a factor-based scoring system

19 Warehousing Issues in warehousing for inbound raw materials, sub-assemblies and supplies is similar to issues in warehousing outbound finished goods warehousing. They differ primarily in terms of the following: type of facility used value of material perish ability

20 Production Planning and Control Demand Forecasting Production Scheduling- quantities, timing Resource Allocation machines labor material budget

21 Transportation The transportation activities concern bridging the spatial and temporal gaps between the vendor and the firm and the firm and it s customers. Some issue that need to be addressed include: control transportation mode rates and cost analysis routes carrier services claims handling

22 Receiving and Quality Control Receiving Inspection- variance checking between order and shipment Physical damageclaims, legal issues Quality Control quality benchmarks variance measurement and analysis statistical quality control

23 Channels of Distribution A series of cooperating entities who facilitate the flow of goods and services from the producer to the end user. Wholesaler, retailers, producers sales branches, agents, brokers etc are examples of such entities Primary benefits include cost efficiencies and customer convenience Conventional channel versus Vertical Marketing System Intensive, Exclusive and Selective Distribution Cooperation, conflict and Competition within and between channels

24 People Training Learning - Knowledge Team Work Cross-Functionality Buy-in Management Workers

25 Technological Information Substitution E-commerce E-logistics E-procurement Materials Substitution Greener Materials Packaging Advances Delivery Mechanisms

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