SUMMARY
The
approach to logistics strategy planning outlined here must of course flex to
suit
particular industries and business situations. The important theme is the use
of
a formalized framework that takes into account business issues as well as more
detailed
logistics issues and combines the conceptual and quantitative evaluation
techniques
that are available. The basic methodology can be followed in any
organization.
The
various roles of DCs and warehouses were discussed, and once again the
influence
of the different elements within logistics was noted.
The
basic cost relationships have been described. These relationships have been
brought
together to produce a total logistics cost. It has been shown that trade-off
analysis
can be used to help optimize the cost-effectiveness of distribution systems,
even
where this may mean that individual cost elements are increased.
A
formal planned approach for developing a physical distribution strategy was
described.
The major discussion points have been the need to determine appropriate
product
flows and the planning of DC and facilities location. A number of
different
aspects have been covered, and it has been emphasized that the problem
is
a complex one, involving a great deal of data manipulation and the need for
quite
sophisticated modelling techniques.
In
the final section, a number of factors were put forward for consideration when
a
practical search for a site takes place. These factors are all influential in
ensuring
the effective operation of a DC.
