China
Africa
Explore chapters and articles related to this topic
Supply Chain Excellence
Published in James William Martin, Operational Excellence, 2021
Inventory turnover directly relates to a product's lead time, its expected demand, and the required service levels. Organizations periodically take actions to reduce inventory levels by applying improvement projects. But how far inventory can be reduced depends on the ability to reduce lead time and mange demand. In fact, benchmark statistics show inventory turnover ratios vary across diverse industries in a range of one to one hundred or higher. These ratios depend on the type of industry and process, but also on the effectiveness of inventory management. As an example, in organizations that have many different products and limited capacity (e.g., consumer products), inventory will be created and stored in distribution centers. When an organization produces many different products, it is difficult to reduce economic production lot sizes without applying significant process engineering redesign through technology, although Lean significantly helps (e.g., single-minute exchange of dies and many other effective methods). Inventory management practices also vary based on the underlying process design. There are make-to-order, assemble-to-order, and make-to-stock systems. Inventory investment strategies are different for each one. Make-to-order and assemble-to-order processes will not have a large finished goods inventory compared to make-to-stock systems. Make-to-stock systems have high finished goods inventory levels because of the number of products which need to be produced in advance of demand because of limited available production capacity. In contrast, investment in raw material and WIP inventories is usually higher in make-to-order and assemble-to-order systems if system throughputs are low. It is important that organizations understand what is necessary to manage and optimize inventory investment to efficiently allocate investment resources.
Digital technologies and business opportunities for logistics centres in maritime supply chains
Published in Maritime Policy & Management, 2021
Francesco Parola, Giovanni Satta, Nicoletta Buratti, Francesco Vitellaro
Logistics centres of the first typology rely on basic facilities characterised by a low/medium level of infrastructural and managerial complexity. Warehouses and deposits represent buffering nodes of logistics network. They support the inventory management of suppliers, producers and customers of the supply chain (Higgins, Ferguson, and Kanaroglou 2012). When it comes to the maritime domain, this typology includes, among others, container yards/inland container depots, that provide primary services related to storage, cleaning, maintenance and repair of empty containers, and distribution centres, which combine cargo storage activities with handling functions. Distribution centres collect and split shipments from different origins and, then, send cargo toward various destinations, supporting the organisation of transport and logistics network. For this purpose, they require suitable ICT platforms aiming at managing the multitude of orders and related physical and information flows (Kia, Shayan, and Ghotb 2003).
What happened to inventory and cost after a vertical integration? A longitudinal analysis considering demand uncertainty
Published in International Journal of Production Research, 2019
Before vertical integration, inventory decisions at distribution centres were made solely by the distributor that owns the distribution network. By employing the make-to-stock inventory system, the inventory managers at the distributor arranged deliveries from packaging plants to replenish inventory at distribution centres after considering the forecasted demand information and the inventory levels at distribution centres. These inventory arrangements normally take less than a day. However, after vertical integration, these inventory arrangements are made jointly by the distribution unit and the production unit in the newly integrated firm. More time is required to communicate between two units in order to make such inventory arrangements. In light of longer time for inventory decisions, inventory levels will increase to satisfy demand during the additional time. Hence, the average inventory level increases because of operational conflicts after vertical integration.
A multi-dock, unit-load warehouse design
Published in IISE Transactions, 2019
A variety of facilities with a common identification, warehouse or distribution center, play a critical role in today’s supply and distribution networks by facilitating and speeding up movements of products between manufacturers and customers, as well as reducing costs of operations. The design of the network includes decisions regarding the number, sizes and locations of distribution centers. Due to a vast number of design alternatives and uncertainty of demands, designing and managing a distribution center or warehouse can be a complex task with multiple conflicting objectives such as minimizing operating cost and minimizing capital investment. Alternatively, depending on the warehouse mission, the design objective can be the minimization of the maximum time required to retrieve products in the warehouse or the maximization of the probability the time to store or retrieve a unit load is less than an aspiration level.