Studied by 1 person
Logistics
moving things from the point of origin to the point of consumption
Inbound Logistics
sending things from suppliers to manufacturers
Material Handling
moves goods and materials between sites
Outbound Logistics
moves finished goods to the customer
Warehouse
facility used to store goods and materials
Warehousing
the function that allows companies to store, repackage, and distribute to the customer
Functions of a Warehouse
receiving, storage, picking, packing, shipping
Secondary functions of a warehouse
quality inspections, repackaging, assembly operation
Public Warehouses
warehouses with privately owned equipment, privately run staff, monthly storage fee
Pros public warehouse:
no capital investment, flexible, low cost
Cons public warehouse:
Potentially incompatible computer systems, space not always available
Contract Warehouse
rent out space on yearly contract, for the whole building or a defined portion
Pros contract warehouse:
specialized services tailor made for needs, cost can be negotiated, and more control
Cons contract warehouse:
duration is longer
Private Warehouse
company owned storage, for companies with large volume or valuable goods, or special storage
Pros private warehouse:
better control, visibility, and cheaper in long run
Cons private warehouse:
high start up cost, fixed location, fixed size/costs
Consolidation Warehouse
goods from different suppliers stored in one warehouse. Many different goods sent out in one shipment
Break-Bulk Warehouse
goods from one supplier are stored, then sent out in many shipments. One good, many shipments.
Cross-Docking Warehouse
little/no inventory stored, transfer goods between trucks to be shipped off. Transportation cost savings, inventory efficiency
Warehouse network
how many warehouses needed, and where they are needed
Single warehouse
simple, lower costs and inventory, best people in one spot. Long delivery time
Multiple warehouses
quicker delivery. complex, high costs and inventory, spreads out the best people
Hybrid Approach
central warehouse (hub) holds most of inventory, then ships out to dispersed warehouses (spokes). Lowers operating costs and inventory, increases customer service
Market Position Strategy
warehouse close to customers to improve delivery. When there's more customers than suppliers
Product Position Strategy
warehouses close to suppliers to consolidate before delivery. More suppliers than customers
Intermediate Position strategy
warehouses at a midpoint between customer and supplier. Balances cost, inventory and customer service
LEAN warehousing
Includes methods such as cross docking, increased automation, reduced lot sizes and shipping quanitities
3rd party logistics (3PL)
using another company to do your logistics (outsourcing)
4th Party logistics (4PL)
Managees all 3PL companies
Goal of Transportation
maximize value, effective service, and satisfy customer needs
Contract Carrier
transports under contract to one or a few shippers
Common Carriers
transports for a fee, can be hired by anyone
Private Carriers
transports their own cargo as a part of their business
Exempt Carriers
specialize in transporting commodities exempt from regulation by Interstate Commerce Act
Mode of transportation
way of transportation
Carrier
Company that transports
Truck
most flexible form of transportation, most commonly used
General freight carriers
handles a variety of goods in normal trailers, like pallet goods
Specialized carriers
transport liquid petroleum, agricultural commodities, building materials, & other specialized items.
Less than truckload (LTL)
carriers move small shipments, when you don't have enough to fill a truck. Stop at depots and transfer locations to match load to the final location.
Full-Truckload (FTL)
the transport of goods that fill up a full truck, or a partial load shipment occupying an entire truck
Rail
slow and inflexible mode of transport, but has the most capability
Pipeline
most reliable and lowest per unit cost mode of transport. Materials transported in liquid/gas form
Air
fastest and most expensive mode of transport, paired with trucks for door to door delivery
Water
super cheap, super slow and inflexible mode of transport. Used for heavy/bulky shipments
Intermodal Transport
using multiple modes of transportation to get one product from A to B
Interstate Commerce Act
law that forces compliance between states with commerce laws
Cost of Service Pricing
set price based on costs incurred
Value of Service Pricing
set price based on value perceived by customer
Combination Pricing
set between Cost of Service minimum and Value of Service maximum. Very adjustable
Net Rate Pricing
set price to customer's needs
FOB Origin
buyer pays freight costs, ownership passes when it leaves the seller
FOB Destination
seller pays freight costs, ownership passes once good reaches the destination
Freight Forwarder
Consolidates LTL shipments into FTL shipments
Transportation Broker
bring shippers and carriers together
Shipper's Association
Nonprofit cooperatives which arrange for members' shipping
Intermodal Marketing Company
Purchase blocks of rail capacity and sell it to shippers
Types of Logistic Management Software
Warehouse Management Systems, Transportation Management Systems, and Global Trade Management Systems
Reverse Logistics
backwards flow of goods of customers back to the point of origin
5 R's of Reverse Logistics
returns, recalls, repairs, repackaging, recycling
Offshore factory
manufacturing and assembly done overseas to cut labor and raw material costs
source factory
similar to an offshore factory in that it cuts product cost, but with skilled workers and significant managerial resources
server factory
global facility that takes advantage of government incentives (tax reductions, etc.) to meet local market needs
contributor factory
global facility that is focused on product development as well as R+D
outpost factory
global facility set in an area with a lot of advance suppliers, competitors, research facilities, etc.
Lead factory
global facility that is the source of product and process innovation
Global Location Factors
taxes and incentives, proximity to markets, labor/land costs, business clusters, etc.
Weighted factor rating model
location evaluation technique the weights each factor differently based on importance
Break even model
location evaluation technique for when you know fixed/variable costs
Global trade opportunities
increased revenue and sourcing options
global trade challenges
this type of trade is complex, plus it introduces tariffs and duties
International Freight Security
lots of increased legislation post 9/11
US Department of Homeland Security
secures borders, ensures that flow of lawful traffic and commerce
US Customs and Border Protection
protects the US through active inspections at ports of entry, promoting legitimate commerce
Trade Compliance Systems
can automate the process of checking every transaction
Importer of Record
the owner, purchaser, or licensed customs broker must file entry documents for goods at the port of entry
Foreign Trade Zone
designated geographic region through which merchandise is allowed to pass with lower customs duties (taxes) and/or fewer customs procedures
Deemed Export
the release of technology or source code that is subject to the Export Administration Regulations, to a foreign national located in the United States.
Customs Brokers
move global shipments through customs and handle documentation
International Freight Forwarders
Move goods to and from foreign destination
Trading Companies
handle transactions between international buyers
Non-Vessel-Operating Common Carriers (NVOCC)
Operate like freight forwarders but use only scheduled ocean liners.
Customer Relationship Management (CRM)
transformation of people, process and technology required to become a customer first business. The philosophy of putting the customer first
What is CRM used for?
To acquire, retain and meet the changing expectations of customers
Strategically Significant Customers
These customers have high lifetime value, are role models and inspire change for other customers. These are the customers that CRM targets relationships with
Predicting Customer Behavior
If a company is selling products and services to customers, they can also collect customers buying history, preferences, and trend information, which could then be used to predict customer buying behaviors going forward.
Personalizing Customer Communications
Understanding customer behaviors & preferences, firms customize communications
Segmenting Customers
dividing a customer base into groups of individuals that are similar in specific ways relevant to marketing
Target Marketing
Marketing directed toward those groups (market segments) an organization decides it can serve profitably.
Event Based Marketing
develops connections with customers based on events
Cross Selling
buying a related or complementary product after initial purchase
Up Selling
persuades buyer to upgrade or buy a more expensive item
Relationship/Permission Marketing
signing up for promotional emails
Customer Defection Analysis
figuring out why customers stop buying and reducing the loss of these customers
Churn Reduction
reducing customer defections
Customer Lifetime Value (CLV)
approximate worth of a customer to a company in economic terms; overall profitability of an individual consumer
Clickstream
tracking how a customer navigates a website can help tailor a website's images, ads or discounts based on past usage of the site.
Customer Service Philosophy
emphasis on quality and quality management to get customer satisfaction
Customer Service Activity
includes order processing, returns, etc
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