Paper Example on Logistic Network Design

Introduction

Logistic network design aims at the number and site of warehouses and manufacturing plants, distribution of warehouses, product plants and also the allocation of customer demand. Active logistics network are essential for transporting of goods and people in the 21st century. Moreover, designing of the logistic network generally is a significant component of successful material handling in the company's warehouse (Kasilingam, R. G. 1998). The successful logistic interface allows the company to integrate various aspects of its enterprises and helps work closer with its customers hence providing a seamless service.

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As a result of the increasing competition across the globe, the company has to advance its logistical systems to help meet the ever-increasing demands of the customers. A single warehouse will help the company manage the flow of its raw material, semi-finished goods, and finished goods to a central location for serving the whole market. Using a single warehouse involves making a tradeoff between the distance between the fixed warehouse cost and the suppliers (Kessler, M. 2013). The network will be designed with the aid of proper analysis of the company's operations. It will greatly assist in creating an effective strategy for the company. Also, the location and size of the warehouse will be agreed upon. The movements of goods and facility costs will be adequately calculated to avoid making errors. The cost set up will be estimated accordingly. The company network will consist of certain facilities such as vendor, distribution center, manufacturing center and lastly the customers. There will also be an adequate variety of raw materials, semi-finished and finished goods that will flow among these facilities (Li, L. 2014). Finally, the designing logistic network of a single warehouse is so much valuable to the company since it will reduce the transportation costs and the warehousing costs as well as improving the customer service delivery. The optimal network redesigning is essential to the company in different ways, i.e., it helps in minimizing the inventory carrying, transportation costs, warehousing while satisfying customer response time requirements (Zanjirani.et al, 2011).

In the creation of the optimal network design, there are a lot of steps involved that must be considered to meet the standards of the company as well as the satisfaction of customer interest. The first step involves the assessment of the current network to ensure that the loophole or weaknesses of the existing network are not carried forward into the implementation of the optimal network. Secondly, the network optimization database to be designed and populated; it involves supplying the company network with much information to sell out its services. In the third step, the alternatives for a network designed should be created; it will as well act as a back up in case of any uncertainty. Fourthly, it involves network optimization module and its adoption. The network optimization should be adopted diligently for the use of the single warehouse. The fifth step involves the selection of the network optimization tool to ensure it the right one for the use in the warehouse. Implementation of network optimization should be done immediately ensuring it functions well according to the standards set by the company. The alternative network design will be evaluated if in any case will function properly and achieve the set goals of the company. Practical activities to recommend the network structure then follows, i.e., a lot of the rational will be carried out to authenticate the network structure. Lastly, reconfiguration costs for the network will be analyzed; it will involve carrying out the analysis to determine the total cost incurred during the network configuration.

The amount of information and data required to make the above determination includes the following; availability of the full list of the product of the company for the customer's reliance, secondly ensuring that the company customers are located for easy access. Thirdly, it involves the warehousing costs and transportation costs which are incurred during the storage and flow of goods respectively. Fourthly, the demands of the customer for each product is considered accordingly. Also, it will require the size of the shipment for each product, i.e., the dimensions of goods must be considered before shipment is carried out. Finally, the costs of processing the order and the patterns of law by content, frequency, and size will be highly considered.

As a result of the availability of data and information, the following strategy will be employed in the optical network. First, the strategic value of new design will help process the alternative structures for supply chain, and select the one that maximizes profitability, also, strategic network design affects the whole supply chain by providing the framework for successful tactical and operational supply chain process (Wang, L., & Koh, S. C. L. 2010). Moreover, business drivers and typical questions for strategic network design enable the company to either redesign their supply chain or design new chain. The strategies will help in speeding up the production activities of the company. Also, it will also greatly assist in the facility costs of the company.

Conclusion

In summary, due to the increasing competition in the world, companies should advance their logistics to meet the ever-increasing demands of the customers. It requires logistic that will be responsible for the movement of people and materials in the company. Single warehouse helps in the serving the whole market hence aiding in the designing an effective strategy for the company.

References

Kasilingam, R. G. (1998). Logistics and transportation: Design and planning. Dordrecht: Springer-Science+Business Media, B.V.

Kessler, M. (2013). Logistics network design in Africa: Integrating aid flows and national self-supply. Bern: Haupt.

Li, L. (2014). Managing the supply chain and logistics. The Competitive strategy for a sustainable future.

Wang, L., & Koh, S. C. L. (2010). Enterprise networks and logistics for agile manufacturing. London: Springer.

Zanjirani, F. R., Rezapour, S., & Kardar, L. (2011). Logistics Operations and Management: Concepts and Models.