Discuss about the Materials Distribution and Logistics Management.
The logistics management is an important part of the supply chain management that helps an organization to plan the delivery of the products and decide the best possible method to deliver the items to the customers (Rushton, Croucher, & Baker, 2014). A proper logistics management is helpful for any organization to decide on the correct manner of weighing, packing and decide the correct price of the product (Stadtler, 2015). Thus, an effective logistics management is helpful to give the customers the best price and the get the most profit out of the supply.
The present write-up will look into the logistics management of a furniture store that is located in Brisbane, while the manufacturing is done in Thailand. The furniture is supplied from Thailand to Brisbane while going through Bangkok. The write-up will give an in-depth study of the order management done by the organization and the customer service adopted by the organization. It will further evaluate the distribution center operation and the physical distribution system for the online orders. The write-up will help in understanding the various techniques that are employed at various steps of supply chain management and how the techniques help in proper management of the items and proper delivery of the products at the destinations.
For the online store, the furniture store will use the Advanced Shipping Notification (ASN) system (Lai, & Wong, 2012). The system will help the furniture store to make customers aware of the exact date when the product has been shipped and an estimated time when the product will reach the customers.
To manage the order and the customer service, the furniture store, will take into consideration the following steps:
The shipment of the client is optimized based in the weight, size and the requirements of the loading (Dekker et al., 2013). The optimization engine will evaluate the products as soon the order is placed online and will automatically tender the cost of shipment and give the final cost to the clients.
The online logistics will have a management application where the clients will be able to enter their origin and destination and the type of order (Hollensen, 2015). In this way, the customers will get an idea about the amount that will cost them for the shipment.
The shipments are managed electronically and an online bill of lading (BOL) and the bill of shipment is transferred to the entire members who are involved in the shipment (Fernie, & Sparks, 2014). A number of carriers are involved for the shipment of the products. If any of the carriers is not ready to accept the price of the payment, then they can give a modified rate for the shipment. Depending on the modified rate, the entire payment of the shipment will be changed.
Depending on the types of order from the customers and the type of shipping that is needed to transfer the furniture from Thailand to Australia. There is no such charge that can be audited by the furniture store. In addition to this, the urgency of the shipment is also highlighted in the shipment. If the order is urgent, then the cost will also be more accordingly (Toth, & Vigo, 2014).
Once the customer place any order either at the shop in Brisbane or through online, the entire payment break-up will be available for the manufacturer of the furniture as well as at the sellers at Brisbane. Both the sellers and the manufacturer will closely the payment. Any deviation either positive or negative will be pointed out and then the price will be quoted to the customers.
The customers will be given the choice of assembling their furniture either at home or at the warehouse at Brisbane who are placing the order at store. They can have a look at how the assembly looks like and then take the product home or can ask the furniture to assemble the product at home. For the online customer as well as the in-store customers there is the choice of picking up their product at the warehouse or deliver at their home (Monczka et al., 2015). The flexible pick-up or delivery system has been introduced to suit the availability of the customers. In addition to this, the customers can also give a time when they like to get their furniture at their home.
The entire process of the order management takes place within one hour of the placement of the order. The customers who give their order in the store of Brisbane as well as the customers who are placing their order online will have to wait for just for one hour to know the exact price of the products. The customers can tell the urgency of the products, and then they will be able have to pay the extra amount to get the order early (Waters, & Rinsler, 2014). The breakup of the payment details will be provided to the customers to make the dealings transparent.
The Advanced Shipping Notification system that has been mentioned earlier will help in enhancement of the operations in the distribution center. The managers will be able to get an idea about the products that will come to warehouse for labeling before delivering it to the customers if the order is given online (Bowersox, Carter, & Monczka, 2013). To enhance the business of the furniture store, there are three distribution centers. One is in Brisbane, second in Thailand where the product is being manufactured and the third is at Bangkok. As the carrier has to pass through Bangkok, the furniture store want to make the most of the place, the distribution center operates from three different places but in the same manner
The furniture store will act in an integrated manner with the suppliers. By communicating closely with the suppliers the owner will be able to tell the exact time of delivering the products (Zhang et al., 2013). The owner will hire a permanent vendor compliance manager who will be responsible for looking after the vendors and work closely with them so that the distribution centre will know the exact time when the products will be dispatched from the vendor and it will turn help them to give popper time of delivery to the customer.
The furniture store aims at reducing the cost of the labour at the distribution centre and hence, the data collection technology is helpful for the furniture store. Instead of keeping the track of the orders on pen and paper, the furniture store uses radio frequency identification and bar code to keep a track of the furniture that are being delivered in different parts of the country. The automatic data collection technology is applicable for orders that are given online as well as the order that are given at the store. It helps the furniture store to increase the productivity of the organization (Brandenburg et al., 2014). In addition to this, it makes the work easier and the calculations are accurate, which is, at times not proper when done manually.
Depending on the size of the order, the ways of picking are decided at the distribution centre. At the distribution centre, different ways of picking up is available so that if any of the process did not seem to suit the organization, they can shift to some other ways of picking (Govindan et al., 2014). There are separated zones for:
Quite similar to the problems regarding keeping the data manually, it is problematic to select the products manually; hence, some of the latest technology like voice pick, RF units that are mounted in wrist and put- or pick-to-light technologies are used (Wisner, Tan, & Leong, 2014). The hands-free processes is helpful for weighing the products at the distribution center and then select the way of packing the products and the cost of the shipment of the products at different places. The hands-free process takes up less time and helps in reducing the labor cost for the organization.
The furniture shop will do the physical distribution of the products that are placed online in the following manner:
Depending on the place of the delivery, the physical distribution for the online store of the furniture centre will vary. From the e-fulfillment centered, the furniture can be directly transported to the local depot or will be transported to the parcel hub. From the parcel hub, it will be delivered to the centre where the furniture it will be sorted as per the delivery address. After the sorting is done, it will be transported to the delivery centers. If the furniture needs to be transported within Brisbane then it will directly go to the home of the customers. If the furniture needs to be parceled elsewhere, it will be either sent to the collection point. From that point, it will be delivered to the delivery point. As per the situation, it can also be delivered directly to the delivery point.
The furniture store has not turned to third party logistics and has handled the orders from the customers all by themselves. They have their separate distribution centre and hence, there is no need to take the help of any third party logistics to manage the orders that are placed online (Christopher, 2016).
The most challenging part for the furniture store for the online orders are unpacking and repacking the products (Grabara, Kolcun, & Kot, 2014). The customers who are giving the orders online are placing the order just by seeing the images. Hence, it becomes important for them to ensure the customers that the products will not vary from the images that they have seen online.
The logistics management approaches that are taken by the furniture store are commendable but it is recommend that they should keep a regular check on the export and import clause of the Thailand and Bangkok. A business is successful only when it is able to gain profit. If they do not keep a regular check, then they might have to pay hefty amount of money for the violating the rules of shipping through the countries. As a result, even if they manage the shipping well, they might not be able to gain profit for overlooking the shipping clauses.
Conclusion
The order management process, the operations at the distributions centre and the physical distribution process concludes the fact that it takes huge planning to deliver one product from one place to another. For an organization that is delivering heavy products like furniture, proper management of the fright become even more important. It has been seen that some of the aspect taken into consideration by the organization while managing the order are load optimization, carrier selection, shipment execution, freight audit and payment and assembly and delivery of goods in a proper manner. It has been seen that with the help of technology, the organization is manage the distribution centre in an effective manner. The physical distribution of the online delivery need some extra planning depending on the distance of the delivery of the item.
Even though the furniture store is managing the logistics well, it has been recommended that they should keep a check on the rules of various governments of the countries through which they pass their carrier. The items are getting manufactured at Thailand, and getting transported to Brisbane, where the store is located via Bangkok. The countries have different rules for road, sea and rail transportation. Hence, a constant check will prevent the organization from any issues at the later stage.
References
Bowersox, D. J., Carter, P. L., & Monczka, R. M. (2013). Materials logistics management. International Journal of Physical Distribution & Logistics Management.
Brandenburg, M., Govindan, K., Sarkis, J., & Seuring, S. (2014). Quantitative models for sustainable supply chain management: Developments and directions. European Journal of Operational Research,233(2), 299-312.
Christopher, M. (2016). Logistics & supply chain management. Pearson Higher Ed.
Dekker, R., Fleischmann, M., Inderfurth, K., & van Wassenhove, L. N. (Eds.). (2013). Reverse logistics: quantitative models for closed-loop supply chains. Springer Science & Business Media.
Fernie, J., & Sparks, L. (2014). Logistics and retail management: emerging issues and new challenges in the retail supply chain. Kogan Page Publishers.
Govindan, K., Kaliyan, M., Kannan, D., & Haq, A. N. (2014). Barriers analysis for green supply chain management implementation in Indian industries using analytic hierarchy process. International Journal of Production Economics, 147, 555-568.
Grabara, J., Kolcun, M., & Kot, S. (2014). The role of information systems in transport logistics. International Journal of Education and Research, 2(2), 1-6.
Hollensen, S. (2015). Marketing management: A relationship approach. Pearson Education.
Lai, K. H., & Wong, C. W. (2012). Green logistics management and performance: Some empirical evidence from Chinese manufacturing exporters. Omega, 40(3), 267-282.
Monczka, R. M., Handfield, R. B., Giunipero, L. C., & Patterson, J. L. (2015). Purchasing and supply chain management. Cengage Learning.
Rushton, A., Croucher, P., & Baker, P. (2014). The handbook of logistics and distribution management: Understanding the supply chain. Kogan Page Publishers.
Stadtler, H. (2015). Supply chain management: An overview. In Supply chain management and advanced planning (pp. 3-28). Springer Berlin Heidelberg.
Toth, P., & Vigo, D. (Eds.). (2014). Vehicle routing: problems, methods, and applications (Vol. 18). Siam.
Waters, D., & Rinsler, S. (2014). Global logistics: New directions in supply chain management. Kogan Page Publishers.
Wisner, J. D., Tan, K. C., & Leong, G. K. (2014). Principles of supply chain management: a balanced approach. Cengage Learning.
Zhang, X., Zhang, Z., Zhang, Y., Wei, D., & Deng, Y. (2013). Route selection for emergency logistics management: A bio-inspired algorithm. Safety science, 54, 87-91.
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