“Logistics is a major part of a supply-chain” says Whitley Hounchell, “in addition to producing or providing the good or service a customer wants, it is very important to deliver the product-service bundle in the quantities and particularly, timing requirements set by the customer. Improvement of the supply-chain implies customization of the logistics network.”
Often, the primary driver for evaluating a logistic network design is either an effort to reduce cost, or to improve service, and often, both. The right network design optimizes transportation, distribution operations, and inventory investment to strike the ideal balance of cost and service.
The first step towards customizing would be to design your network to hit the cost/service balance that is right for you. The analysis must start with:
- Network nodes—Full-service distribution centers, cross-dock locations, etc.
- Inventory—Full-stocking locations, centralized slow movers, postponement strategies, etc.
Customizing can help you minimize logistics costs while maximizing flexibility to meet service-level requirements, changing market demands, and mission-critical conditions.
Every business has its own unique logistics needs and challenges – but it’s worth the effort. Customizing your supply chain’s logistics network will ensure you’re poised to meet—and in many cases exceed—tomorrow’s projected business growth.