Submitted by: Submitted by ianity
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Pages: 2
Category: Other Topics
Date Submitted: 01/28/2013 06:48 AM
B I S C O R P. C A S E
*Serves about 2,000 retail stores including Home Depot, Wal-Mart
As well as BIS-owned stores.
*Single-tier network, all products are shipped from plant to 17
Warehouses.
*Family venture (1964), now owned by 12 shareholders.
*Sells 4,000 SKU’s
*CEO is concerned that supply chain is NOT efficient(
**Inbound truck utilization,
**Inventory turns &
**Service levels are TOO LOW(
*Production & distribution strategies 20 yrs. Back model?
*Shareholders in search for “outside help” in modifying logistic
Network & supply chain strategy.
Re-engineering the production, inventory, & logistics functions.
*Identified 3 important issues that need to be addressed:
**What is the best network configuration that the BIS corp. should
Use?
Single-tier network, low truck utilization, hence high transport cost.
Proposed two-tier distribution network, with a primary & secondary
Warehouses. Whse.1 to receive products from the plants & transfer
Inventory to Whse.2 who in turn will serve the retail outlets.
**Given the new network configuration, where should the company
Position inventory? How much? With 4,000 SKU’s?
**Which plant should produce which product?
*CEO insist that delivery time should be no more than one day for most
Of the retail outlets (service level).
*Product growth varies from product family.
*CEO & Company shareholders oppose building a new manufacturing
Plant because of the cost and risks involved.
NETWORK PLANNING - the process by which the firm structures and manages the supply chain in order to:
*find the right balance between inventory, transportation, and manufacturing cost.
*match supply and demand under uncertainty by positioning and managing inventory effectively
*utilize resources effectively by sourcing products from the most appropriate manufacturing facility.
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