Supply Chain Exam 4

Sortation

focused on assembling like products together for storage in the distribution facility to customer

Allocation

focuses on matching available inventory to customer orders for an SKU

Accumulation

DC serves a collection point for product coming from multiple origins and provides required transfer, storage, or processing services, allowing firms to consolidate orders and shipments for production and fulfillment

RDC

Regional Distribution Center

LDC

Local Distribution Center

Assortment

Involves the assembly of customer orders for multiple SKUs held in the distribution facility. 

SKU

Stock Keeping Unit

Labor Availability Issues

historically low US unemployment rates nature of DC operations work creates ongoing turnover, smaller labor pool

SOLUTION: DC automation and assistive technology

Demand Variation

Seasonal demand creates space and equipment utilization challenges

SOLUTIONS: third party logistics facility use during peak season 

Increasing Customer Requirements

strong desire for value added capabilities and services and growing expectations

SOLUTION: flexible fulfillment processes 

Slotting

the placement of product in a facility for the purposes of optimizing materials-handling and space efficiency. (popularity, size, cube)

Receiving

schedule carriers, unload, inspect, verify

Put-away

identify product, verify location, fill storage, crossdock

Replenish and Order Picking

verify moves, validate SKU, fill customer orders, prep and deliver

Shipping

schedule carriers, load, secure, complete paperwork 

Order Picking Best Practices

minimize travel time, maximize time spent picking product, facilitate accurate order picking, leverage materials handling equipment, minimize idle times

Replenishment

Pallets to store (big orders)

Order Picking

sending items to customer (small orders)

Cross-docking

goods flow directly from receiving to shipping, eliminating time consumption storage or order picking 

Bonus

5 40ft in 3 53 ft containers

5 Modes of Transportation

Water, Air, Pipeline, Rail, Truck

Motor Carriers

Low fixed cost, High variable cost

Most widely used in domestic supply chains or adjacent countries (CA and MX)

Local

<100 mi

Regional

100-500 mi

Long Haul

500+ mi

For hire

big companies, avg 325 mi

Private

avg. 46 mi

For Hire/Private

private that don’t want to anymore (liability)

Railroads

High fixed cost, low variable cost

Primarily used for long distance of low value goods, lacks direct assembly

Interline Agreement

provide coast to coast service

Linehaul

serve major markets, provides a full array of interregional or regional services

Shortline

serve smaller markets, local delivery, trips that linehaul don’t find profitable 

Air Carriers

High variable cost, low fixed cost

traditionally expensive, for emergencies

small quantities of high value, low weight

Water Cargo

High variable cost, low fixed cost

significant role in development of countries 

For hire carriers

linear services, charter services

Specialized Ships

containerships, bulk carriers, tankers, general cargos

Revolutionary Container

Malcom McLean, 1956, Father of Containerization

Panama Canal 

Canal opened in 1914, built by U.S. then sold to Panama, 14K TEU

Suez Canal

Opened in 1869, built by French and Egyptians and owned by them and the British, 18K TEU, no locks

Pipelines

High fixed cost

unique mode, US has largest energy

mainly moves liquid and gases

Intermodal

use 2 or more modes to move products

Benefits

greater accessibility, reduce carbon footprint, global trade facilitation

Growth Drivers

better information systems, developments of standardizations containers

Scope 1

direct emissions from sources owned controlled by the company, such as bring fuel in company vehicles

Scope 2

indirect emission from the generation of purchased energy, such as electricity in company’s buildings

Scope 3

indirect emission that occur in the company’s value chain, including upstream/downstream emissions suppliers, vendors. 

California Air Resources Board (CARB)

clean air regulations in Cali

Advanced Clean Fleet (ACF)

Replace all diesel trucks

Battery Electric Vehicle

pros: zero carbon emission, lower maintenance cost

cons: expensive, no access to charge, battery life, time to recharge 

Drayage

trucks that pick up and deliver from railroads

Slip seating

one driving during the day and then switching so another can drive at night - truck drives 24/7

Hydrogen Powered Trucks

pros: zero emission, faster refueling than electric, longer range

cons: even more expensive, process to extract hydrogen, limited fuel, storing hydrogen 

Compressed Natural Gas

pros: available now, fast refueling, cheaper

cons: trouble storing compressed gas, potential methane release, NOT cali compliant 

Bio Diesel

made from veg. oils, animal fats, algae, and recycled cooking oils. produced by a chemical reaction to an alcohol

Renewable Diesel

made from veg. oils but is refined like traditional diesel, typically in converted oil refineries.

chemically the same as diesel 

Natural Gas

inexpensive, very combustile, not zero emission, non renewable

Rank

1. air

2. truck

3. water

4. pipeline

5. rail