Network Design

Network Design

Chapters 4

Outline











Role of distribution centers in supply chain

systems

Factors influencing network design decisions

Design options for distribution network

Framework for network location decision

Models for Facility Location and Capacity

Allocation

5-2

 Traditional









role of warehousing

Storage

Contingencies

Smoothing

Service

 Proponents

of e-business predicted the

death of intermediaries like distributors

What are new roles of

distribution centers in supply

chain systems?

Inbound Logistics

Outbound Logistics

Product Variety

DC

Suppliers

Customers

Movement of Goods Between

Regions

Facility

Facility

DC

FedEx Asia One

Beijing ETD 1515

Seoul ETD 2155

Shanghai ETD 1935

Hong Kong ETD 2210

Narita ETD 2200

Osaka ETD 2235

Bangkok ETD 2100

Kaohsiung

Guangzhou

Penang ETD 1845

Taipei ETD 2245

Kuala Lumpur ETD 2035

Manila

Cebu

Singapore ETD 2135

FedEx Asia One

Beijing ETA 1154

Seoul ETA 0950

Shanghai ETA 0800

Hong Kong ETA 0523

Narita ETA 0805

Osaka ETA 0733

Kaohsiung

Penang ETA 0942

Guangzhou

Taipei ETA 0733

Kuala Lumpur ETA 0714

Manila

Cebu ETA 0553

Singapore ETA 0556

Jakarta ETA 0958

Recent trends of Network Design

 Strategic

 Moving

position of inventories

to greater use of direct shipping

 Growing

use and need for strategically

located cross docking facilities.

 Greater

use of third party logistics services

Factors Influencing

Distribution Network Design

 Distribution

network design options must

be compared according to their impact on





customer service

the cost to provide this level of service

Factors Influencing

Distribution Network Design

 Elements

of customer service influenced

by network structure

 Supply

chain costs affected by network

structure:

The Cost-Response Time

Frontier

High

Borders

W.W. Grainger

Cost

McMaster...