How to make your Supply Chain efficient

Modeling the Supply Chain

Supply chain is a network of Vendors (Suppliers), Manufacturers (production facilities), Assembly shops, Distribution Centers (Warehouses) and Retail stores. Despite huge disruption caused by Digital channels in a traditional retail or wholesale market landscape, this definition of supply chain will find many buyers. Technology has surely enabled the POS (Point of Sale) option available at customers fingertips but that is no excuse for organizations not to keep refining their processes and redesigning their network in order to efficient and cost-effective. The companies with right attitude towards optimization has rather taken this monumental disruption as challenge and converting this into an opportunity.

Technology brings the access to information. The more information supply chain planner gets, more cognizant decision like inventory policies, Quantity discounts, trade promotions, product allocation to warehouse and markets can be taken.

Challenges:-

Some of the significant challenges firms are facing in their operating environment are:-

1. Stagnant or decreasing market volume

2. Shorter product and technology lifecycle

3. More demanding consumers and competition driven by price that forces participants to rationalize resources wherever possible

Opportunities:-

The Fundamental objective of an efficient supply chain is to synchronize a firm’s functions and those of its suppliers to match the flow of material, services and information with the customers. Intrinsically, meeting this objective brings down the total cost of operations.

How Modeling helps:-

Effective Modeling is the most important and fundamental skill any potential problem solver can learn. As aptly put by Glover-Kingman in their outstanding work of ‘Network models in optimization and their applications in practice’- In terms of a popular analogy, a modeler may be viewed as a “map maker” and a problem solver as a “navigator”. A poorly prepared map(model) may distort the features of the terrain sufficiently that even the best navigators will be unable to find a way from one point to another. And hence in the context of supply chain design, Modeling is among the most fundamental of pursuits.

Questions that must be answered in the design of a Supply Chain :-

1. What is the optimum number, locations and size of warehouses a firm should build

2. Which products to be stocked in which warehouse and what is the optimum quantity

3. Which plants and vendors are to supply which product to each of the warehouses

4. Customer to be served by which warehouse and how to define/control that in system

5. Mode of Transportation

6. Degree to which company will carry out its own distribution activities or opt of 3PL

7. Physical routing of vehicles

8. Selection of an effective inventory control system to maximize profits

A tactful supply chain planner will approach to get answers for each of the above questions in a scientific way and will try to incorporate concepts from several management disciplines:-

1. Strategy formation and theory of the firm

2. Logistics, production and inventory management

3. Demand Forecasting and Marketing science

4. Operations Research

We at Milk-Run consulting specialize in Designing the supply chain and bring cost effectiveness into operations for our clients. We extensively rely on proven statistical methodology and powerful algorithms to generate optimum solutions for our clients. Additionally our unique value based offerings are lucrative option for organizations seeking such engagements.

Please visit our homepage https://milk-run.co.in or drop us a line at bd@milk-run.co.in with your requirement and we will be in touch.

Team Milk-Run

Team Milk-Run