Supply Chain Ch14: Logistics, Distribution, and Location

Book Logistics

The process of coordinating and moving material and other resources from one location to another.

Class Logistics

Consistently and efficiently getting your stuff to the right place, right time, right condition, and for the right cost.

Transportation Modes

Airplane (flight), water, (freight boat), road (trucking), rail (train), pipes (liquids), and hand delivery.

Trucking

Efficient, plentiful, and flexible.

Dedicated - exclusive third-party fleet

OTR - Over the road (vs regional and local)

LTL - less than load

Dry freight/reefer freight

TEU - Twenty-foot equivalent Unit (shipping container)

Water

Cheap, requires access and infrastructure

Brown water shipping - rivers and coastal water

Blue water - ocean freight

Rail

Rail - efficient, cheap, no final mile

Specialized rolling stock

Tank cars and bulk transport

Intermodal and piggybacking

Airfreight

Fast, flexible, and secure

Pipelines

super-efficient

2.4 million miles in the US

72,000 miles for crude oil

Raw materials and Finished goods

Point-to-point utilities

24/7, 365 days

Expensive to build

The Final Mile

Any delivery to consumers is SUPER expensive

Trucks, vans, cars, drones, humans, etc.

Transportation Hub

center for travel (rail, shipping, canals, roads, etc). Part of a transportation network. Roads leading out are spokes. (Chicago, Houston, Atlanta)

Warehouse Facilities designed for

Distribution, Order fulfillment (picking and packing), Warehousing (storing inventory)

Warehouse Facility Designs

U-shaped layout (receives and ships in a U shape, Adidas Indy), L-shaped layout, I-shaped layout

Cross-Docking Capabilities

Mainly for large shipments to be broken down into smaller shipments.

Business Climate

Favorable laws, workforce education and availability, similar businesses. Taxing and regulatory policies, political and social climate.

Cost of Doing Business

Low cost of doing business

Land and construction costs

Law of labor (on or offshore)

Infrastructure

Roads: interstate connections

Railroads: frequency and lines

Airports: passengers and cargo

Energy and water: cost and availability

Quality of Labor

Education, work ethic, right-to-work

Local suppliers

Location and accuracy

Industry-specific expertise and talent

Availability of raw materials

Government Incentive

Infrastructure and utility build-out

Tax abatements

Job training

Free trade zones!