Distribution Management Flashcards

LO16: Distribution Network Design and Systems

• Distribution network design creates a path for goods to reach customers, balancing needs and costs.
• It focuses on response time, product variety, availability, customer experience, order visibility, and returnability.
• Distribution systems use tracking software (e.g., Oracle NetSuite) to monitor shipments and provide real-time updates.
• These systems enhance supply chain visibility and enable shipment consolidation.

LO17: Comparison of Distribution Channels

• Distribution channels are routes goods take from producer to customer.
• Direct Channel: Producer to customer, offering direct interaction and higher margins.
• Indirect Channels: Involve intermediaries (retailers, wholesalers, etc.), extending market reach.
• Direct channels offer more control but limit reach; indirect channels expand reach but reduce control.
• Indirect channels provide utilities like place and time.

LO18: Modes of Transportation

• Road: Flexible and accessible but affected by weather and has high accident rates.
• Rail: Ideal for bulk transport over long distances, affordable but less flexible.
• Air: Fastest for valuable goods over long distances, expensive and weather-dependent.
• Water: Affordable with high capacity, slow and requires infrastructure.
• Pipeline: Reliable and safe for specific goods like oil but inflexible.

LO19: Inbound vs. Outbound Distribution

• Inbound Distribution: Receives materials from suppliers for production, using JIT to minimize storage.
• Outbound Distribution: Delivers finished goods to customers, focusing on customer service.
• Direction: Inbound is upstream (supplier to manufacturer), outbound is downstream (manufacturer to customer).
• Focus: Inbound emphasizes procurement, outbound prioritizes customer satisfaction.
• Activities: Inbound involves receiving materials, outbound involves distributing finished goods.