Term
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Definition
| a summary of how a company plans to service its customers at the strategic level; the mechanism by which a business intends to generate revenues and profits |
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Term
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Definition
• Plan- what needs to get done? Goals? How? When? Why.
Execute- Put plan into action. Day-to-day management
Measure- Identify what’s good/bad. Why is it so?
Improve- How can we meet tomorrow’s needs. |
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Term
| Key organizational goals/objectives |
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Definition
| to fulfill customer needs, maximize return on investments and sustainable profitability, resource utilization/eliminate waste. |
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Definition
| cost, quality, flexibility, speed/time |
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Term
| 3 categories of measurement |
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Definition
| effective, efficient and adaptable |
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Term
| Value (customer perspective) |
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Definition
| what do I get divided by the price |
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Term
| Productivity (organizational perspective) |
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Definition
| what did I make/ what was the cost |
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Term
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Definition
efficient integration of suppliers, transporters, manufacturers, warehouses, retailers and all other parties associated with delivery of the final product.
the management of all activities that facilitate the fulfillment of a customer order for a manufactured good to achieve satisfied customers at reasonable cost. |
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Definition
| the process of obtaining services, supplier and equipment in conformance with corporate regulations. |
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Definition
| Design, Operation and improvement of production systems that efficiently transforms inputs into finished goods and services. |
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Definition
| the coordinate planning and execution of product distribution through the supply chain, preparation of packaged product, movement itinerary, storage itinerary. |
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Term
| Vertically Integrated Firm |
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Definition
| a firm whose business boundaries extend to include one-time suppliers and/or customers. |
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Term
| Examples of Reverse Logistics Activities |
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Definition
| return products, warranty repairs, throw products away, recycle products. |
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Term
| Second-tier suppliers and customers |
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Definition
| the customers’ customers and the suppliers’ suppliers. |
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Definition
| variations of having too much safety stock are amplified as one moves upstream in the supply chain. |
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Term
| Supplier management, evaluation and strategic partnerships |
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Definition
Supplier management- getting your firm’s suppliers to do what you want.
Supplier Evaluation- determining the capabilities of suppliers
Strategic Partnerships- trading-partner relationships, which is strategic for firm and supplier. |
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Definition
| objective of matching demand to available capacity, either by improving production scheduling, curtailing demand, using a back-order system, or increasing capacity. |
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Definition
| ensures continued quality compliance among suppliers and with internal production facilities. |
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Term
| Transportation Management |
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Definition
| decisions typically involve a trade-off between cost and delivery timing or customer service. |
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Definition
| one method of ensuring successful product delivery, i.e.- utilizing a large number of regional or local warehouses in order to deliver products quickly to customers. |
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Definition
| occurs when the participants realize that supply chain management must become part of all of the firms’ strategic planning processes, in which objectives and policies are jointly determined based on the final customers’ needs and what the supply chain as a whole does well. |
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Definition
| raw materials, work-in-process, or finished goods that are maintained to support production or satisfy customer demand. |
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| Original Equipment Manufacturer |
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Definition
| depend on a network of supplier and often have rather complex supply chains, example is the automobile industry. |
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Term
| Supply Chain Operations Reference Model |
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Definition
| plan, source (procuring goods and services to meet demand), make, deliver and return. |
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Term
| Value and Supply Chain at Dell |
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Definition
| business model based on selling direct to customers and bypassing traditional intermediary wholesalers and distributors. Computers are assembled only in response to individual orders. Customers can place orders through Internet, telephone lines and small sales outlets in some malls. Electronically links customers, suppliers, assembly operations and shippers. |
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Term
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Definition
| focus on gaining a customer and increasing both efficiency and responsiveness of the supply chain. (Customer benefit package design and configuration, corporate partnerships, customer financing, technical support, purchasing, customer order entry, software and hardware licensing and promotion/advertising) |
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Term
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Definition
| focus on creating and delivering the manufactured goods. No finished goods inventory, based on actual customer orders. |
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Term
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Definition
| focuses on keeping the customer (billing, shipping, installation, warranty and field repair services, online training services, servicing loans/financing, returns/recycling, technical support. |
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Term
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Definition
| can be sold anytime, quick sale is preferred but not required |
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Definition
| items must sell quickly. Period of high demand is limited, next year may be an option. |
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Term
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Definition
| demand period for these is finite. Selling after today may not be possible. |
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Term
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Definition
| protects against uncertainty demand, lead time, supply (not intended to be used, it is cushion/insurance) |
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Term
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Definition
| used to absorb uneven rates of demand or supply. (seasonal demand, holidays, quantity discounts, economic) |
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Term
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Definition
| Inventory readily available on the shelf. |
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Term
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Definition
orders that have been placed but not yet received nor paid for by customer.
Inventory moving from point to point in the materials flow system. (average demand for the item per period times the number of periods in the item’s lead time to move between the two points) |
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Term
| Inventory Management at Walmart |
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Definition
| has inventories in excess of $29 billion. Effective management must include the entire supply chain. Uses radio frequency identification technology in supply chain. Uses this info to decide when to bring additional stock to shore shelf and figure out if a store ordered too much product. |
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Term
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Definition
| the planning and controlling of inventories in order to meet the competitive priorities of the organization. |
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Term
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Definition
Pressures for low inventories- inventory represents a temporary monetary investment. Firm incurs and opportunity cost, arising from money tied up in inventory that could be used for other purposes, takes up space, storage and handling costs, taxes, insurance and shrinkage
Pressures for High Inventories- customer service, ordering cost, setup cost, labor and equipment utilization, transportation cost, payments to suppliers. |
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Term
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Definition
| the sum of the cost of capital and the variable costs of keeping items on hand, such as storage and handling, taxes, insurance and shrinkage. |
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Term
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Definition
| the cost of preparing a purchase order for a supplier or a production order for the shop. |
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Term
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Definition
| the cost involved in changing over a machine to produce a different item. |
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Term
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Definition
| the portion of total inventory that varies directly with lot size. |
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Term
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Definition
| the determination of how frequently and in what quantity to order inventory. |
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Term
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Definition
| surplus inventory that a company holds to protect against uncertainties in demand, lead time and supply changes. |
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Term
| Inventory Reduction Tactics |
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Definition
| primary lever to reduce cycle inventory is to reduce the lot size, but need to make other changes too. If changes occur two secondary levers can be used: streamline methods for placing orders and making setups to reduce ordering and setupcosts and increase repeatability to eliminate need for changeovers (repeatability). Also safety stock inventory (improve forecasts, cut lead times of items to decrease demand uncertainties, reduce supply uncertainties, rely more on equipment and labor buffers), anticipation inventory (add new products, provide off-season promotional campaigns, offer seasonal pricing plans) and pipeline inventory (find more responsive suppliers and new carriers for shipments or improve materials handling, decrease Q, lot size). |
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Term
| Inventory Management at Amazon.com |
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Definition
| items are grouped together in shipping facilities. They forecast demands by areas of the country. Increased warehouse capacity, state of the art automation and mechanization, linked order information to a customer archive using information technology, replicated the system across its distribution centers where possible. Now uses combination of in-house and outsourced warehouse operations. |
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Term
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Definition
| Inventory can be held at raw materials, work-in-process and finished good levels. A special item is made to order or bought to order a standard is an item that is made to stock, or ordered to stock. |
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Term
| Independent vs. Dependent Demand |
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Definition
| Independent demand items are items for which demand is influenced by market conditions and is not related to the inventory decisions for any other item held in stock. Dependent demand items are those required as components or inputs to a service or product. |
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Term
| basic steps in the purchasing process |
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Definition
| requisition (somebody needing something), supplier selection (new supplier, old supplier?), place order (bids, contracts, analyze competitive priorities, negotiate), track order (order early? Late? On time? Shelf space? Customer expectations?), receive order (inspect, record, shelve). |
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Term
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Definition
| taking over the role of your supplier. Forward Integration- Taking over the role of companies closer to the customer. |
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Term
| Supplier-Partnering Hierarchy |
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Definition
| conduct joint improvement activities, share information intensively but selectively, develop suppliers’ technical capabilities, supervise your suppliers, turn supplier rivalry into opportunity, and understand how your suppliers work. |
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Term
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Definition
| purchasing supplies/services from outside company |
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Term
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Definition
| paying outside firms to handle what are normally considered internal business functions. |
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Term
| primary goals of purchasing |
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Definition
| ensure uninterrupted flows of raw material at the lowest total cost, to improve quality of the finished goods produced, and to optimize customer satisfaction. |
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Term
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Definition
| when the material user initiates a request for a material. (sometimes purchase requisitions are used) Traveling requisition- when requested on recurring basis. |
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Term
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Definition
| a document issued when an organization wants to buy something and chooses to make the specifications available to many other companies so they can submit competitive bids. |
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Term
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Definition
| allows suppliers to propose new material and technology, thus enabling the firm to exploit the expertise of suppliers. |
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Term
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Definition
| when a suitable supplier is identified, or a qualified supplier is on file, a feature is the terms and conditions of the purchase. It is the buyer’s offer and becomes a legally binding contract when accepted by the supplier. |
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Term
| Electronic Procurement Systems |
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Definition
| material user initiates by entering a materials request and other relevant info. Next printed out and submitted to the buyer at purchasing department. Buyer reviews and transfers mater requisition data to e procurement system and assigns qualified suppliers to bid on the requisition. Buyer reviews bids, purchase order is submitted electronically to selected supplier. Besides a high start up cost, it makes everything a lot easier. Time savings, cost savings, accuracy, real time, mobility, trackability, management, benefits to the supplier. |
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Term
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Definition
| Outsourcing purchasing- buying materials and components from suppliers instead of making them in-house; buying materials or components that were previously made in-house. |
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Term
| Buying/Outsourcing vs Making |
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Definition
• Reason for Buying/Outsourcing- Cost advantage, insufficient capacity, lack of expertise, quality.
• Reasons for making- protect proprietary technology, no competent supplier, better quality control, use existing idle capacity, control of lead-time, transportation and warehousing cost and lower cost. |
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Term
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Definition
product and process technologies, willingness to share technologies and information, quality, cost, reliability, order system and cycle time, capacity, communication capability, location and service.
Reasons for One Supplier- establish a good relationship, less quality variability, lower cost, transportation economies, proprietary product or process purchases and volume too small to split.
Reasons for Multiple Suppliers- need capacity, spread the risk of supply interruption, create competition, information, dealing with special kinds of businesses. |
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Term
| Centralization vs. Decentralization |
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Definition
Advantages of centralization- concentrated volume, avoid duplication, specialization, lower transportation costs, no competition within units, common supply base
Advantages of decentralization- closer knowledge of requirements, local sourcing, less bureaucracy |
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Term
| High vs Low Inventory Levels |
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Definition
Benefits of High Inventory levels- customer service levels, costs to order inventory (purchasing costs), cost to purchase-quantity discounts, transportation: ease? Cost? Cons- cost to hold inventory, materials handling, shrinkage/obsolescence, liquidity.
Benefits of Low Inventory Levels- cost to hold inventory, materials handling, shrinkage/obsolescence, liquidity. Cons are customer service levels, costs to order inventory, cost to purchase, transportation. |
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Term
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Definition
the optimal order size. Using the EOQ will give you lowest TC for the given cost structure and demand forecast, not the required Lot Size though!
• The potential weaknesses associated with the EOQ is exact lot size may not be possible/allowed. Time between orders may not be feasible/allowed. Size of EOQ might be too large (not enough storage space) Quantity discounts are not considered- if offered you’d have to calculate an EOQ for every price level.
better for make-to-stock companies
The lot size that minimizes total annual inventory holding and ordering costs. Use the EOQ if you have make-to-stock and a relatively stable demand and if your carrying costs and setup or ordering costs are known and stable. Don’t use if you use make to order and your customer specifies the entire order to be delivered in one shipment and if order size is constrained by capacity limitations such as the size of the firms ovens, amount of testing equipment, or number of delivery trucks. EOQ = square root of (2DS/H) |
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Term
| TBO (time between orders) |
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Definition
| the average elapsed time between receiving (or placing) replenishment orders of Q units for a particular lot size. TBO = EOQ/D times 12 if you want it in months, 52 if you want it in weeks, and 365 if you want it in days. |
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Term
| Understanding the effects of changes in EOQ |
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Definition
Change in the Demand Rate- when demand rises, the lot size also should rise, but more slowly than actual demand.
Change in the Setup Costs- increasing S increases the EOQ and the average cycle inventory.
A Change in the Holding Costs- the EOQ declines when H increases.
Errors in Estimating D, H, and S |
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Term
| Qualitative vs. Quantitative Factors |
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Definition
Qualitative Factors- (more trustworthy, accurate) irrelevant current data, lack of current data, new products, new markets, query executives, experts, salespeople, consumers
Quantitative Factors- (a lot of using old sales data) Trends, Cycles, Seasonal, Randomness. |
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Term
| Simple Moving Average vs. Weighted Moving Average |
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Definition
Simple moving average- the 4 period moving average forecast for week 6 would be the average of the 4 periods prior to week 6.
Weighted moving average- 3 period weighted moving average oldest *.20, second oldest *.3, most recent * .5
4 period weighted moving average oldest *.10, second oldest *.2, third oldest .3, newest *.4
It is appropriate to use simple moving average in industries where demand is fairly stable. It is appropriate to use weighted moving average
• Simple moving average- most useful when demand has no pronounced trend or seasonal influences.
Weighted moving average method- allows you to emphasize recent demand over earlier demand (can even handle seasonal effects but putting higher weights on prior periods in the same season) |
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Term
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Definition
| Unilever uses a great CDP system trying to check forecasts, that blends historical data with promotional data. Conducts external market research and internal sales projections that are analyzed. Because expensive and time consuming, most companies only collect point-of-sale data from largest customers. CDP system has been a success. Unilever has reduced its inventory and improved its customer service. Next step is collaborative planning, forecasting and replenishment. |
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Term
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Definition
| a prediction of future events used for planning purposes. |
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Term
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Definition
| the repeated observations of demand for a service or product in their order of occurrence. Five basic patterns are horizontal (fluctuation of data around a constant mean), trend (the systematic increase or decrease in the mean of the series over time), seasonal (repeatable pattern of increases or decreases in demand, depending on time of day, week, month or season), cyclical (less predictable gradual increases or decreases in demand over longer periods of time), random (unforecastable variation in demand.) |
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Term
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Definition
| the act of clustering several similar services or products so that companies can obtain more accurate forecasts. |
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Term
| Successful Judgment Methods |
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Definition
clearly needed when no quantitative data are available to use quantitative forecasting approaches. Can be used in concert with quantitative approaches. Adjust quantitative forecasts when tend to be inaccurate and make adjustments to quantitative forecasts to compensate for specific events.
Salesforce estimates- the forecasts that are compiled from estimates of future demands made periodically by members of a company’s salesforce. (they probably know it better because they deal with customers firsthand, forecasts of individual salesforce members can be combined easily, sales territories are often divided by district or region.)
Executive opinion- a forecasting method in which the opinions, experience, and technically knowledge of one or more managers are summarized to arrive at a single forecast. (executive opinion can also be used for technological forecasting- an application of executive opinion to keep abreast of the latest advances in technology)
Market research- a systematic approach to determine external consumer interest in a service or product by creating and testing hypotheses through data-gathering surveys.
Delphi method- a process of gaining consensus from a group of experts while maintaining their anonymity. |
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Term
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Definition
| an individual item or product that has an identifying code and is held in inventory somewhere along the value chain. |
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Term
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Definition
Judgment methods- a type of qualitative method that translates the opinions of managers, expert opinions, consumer surveys, and salesforce estimates into quantitative estimates
Causal methods- a type of quantitative method that uses historical data on independent variables, such as promotional campaigns, economic conditions and competitors’ actions, to predict demand.
Time-series analysis- a statistical approach that relies heavily on historical demand data to project the future size of demand and recognizes trends and seasonal patterns. |
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Term
| CPFR- (collaborative planning, forecasting and replenishment) |
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Definition
| a nine-step process for value-chain management that allows a manufacturer and its customers to collaborate on making the forecast by using the Internet. |
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Term
| Facility Location Decisions |
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Definition
| cost (labor, transportation, land, taxes, materials, waste disposal, energy/fuel, theft, national laws, legal costs), labor (labor laws, benefits, applicant pool, required training, work conditions, work ethic, quality of life issues), legal (general civil and criminal laws, law enforcements, crime rates, trade agreements, environmental, tax laws, labor laws), government (government stability, relationships with neighboring countries, currency stability, democratic, socialist, religious tribal, support of business community, support of infrastructure, future plants, support of regional/international trade agreements) |
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Term
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Definition
| geographic concentration of interconnected businesses, suppliers, and associated institutions in a particular field. Considered to increase the productivity with which companies can compete, nationally and globally. But it also means competition, rents are rising, IT sector is pushing up wages, recruitment is hard, house prices are high |
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Term
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Definition
| Toyota has a parts center in Northern Kentucky as a part of its globalization strategy. Receives and stocks parts from more then 375 North American suppliers and assembly plants and ships parts to 20 distribution centers in North America, Europe and Japan. Has production operations in each part of the world where it sells cars and trucks. Also has a distribution center in Cali to handle distribution parts from Japan, allowed Toyota to lower inventory days of supply down to 8 days. Reduced space and inventory requirements. Ford is planning to build a manufacturing campus next to its assembly plant. No supplier is more than half a mile from assembly plant. All suppliers are on the campus. Helps respond to customers more quickly and will cut costs by as much as 20 percent. |
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Term
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Definition
| Britain’s #1 supermarket chain, largest online grocer. Picks orders from its current stores and not build new warehouses for the online business. As business grows, plans to adopt a hybrid approach with warehouses in big cities designed for online customers and order picking. |
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Term
| Critical Factors in Location Decisions |
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Definition
| Economic factors include facility costs, such as construction, utilities, insurance, taxes, depreciation, and maintenance; operating costs, including fuel, direct labor, and administrative personnel; and transportation costs associated with moving goods and services from their origins to the final destinations or the opportunity cost of customers coming to the facility. Might also want to preempt competitors from entering a geographical region. Noneconomic factors include the availability of labor, transportation services, and utilities; climate, community environment, and quality of life; and state and local legal and political factors. Also, many decisions are based on customer demographics. |
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Term
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Definition
(make-to-stock or assembly lines/continuous flow systems) make things over and over, like Walmart/Target products. Standard items, high volumes, static industry. Product focused/line flow layouts. Fast/high production rates possible, capital/machine intensive, low per unit cost, expensive specialized equipment with little flexibility, provides speed, consistent quality, low per unit cost. Short Lead/ Delivery times possible.
Line Flow strengths- item made prior to need (quickly) and fast/consistent production, relatively cheap. Weaknesses- little variability in end item, high start-up costs, higher finished goods inventories. S, U, L, O Shape. Assembly lines can be interrupted, continuous flow lines cannot (bread). |
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Term
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Definition
(make-to-order systems or process focused systems) everything is make-to-order, need more special skilled workers Demand: customized items, low volumes, dynamic industry. Layout- process focused/flexible flow layouts. Job shops. Slower production rates, high per-unit cost, labor intensive, general tools and equipment, skills laborers required, provides flexibility, high performance quality and design quality, long lead/delivery times, make-to-order.
item can be made to customer’s specifications, low cost machinery, adjust quickly/cheaply to changing market conditions. Weaknesses- long lead times, next order unknown, high raw material and work in process inventory possible, slower processing rates, higher inventories and high materials handling more storage space required, more moving equipment required, longer, more costly system changeovers, production planning and control more difficult. |
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Term
| Hybrid Systems (batch processes, GT cellular) |
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Definition
| line flow system with flexible workstations, moderate production rates, balance of labor and automation, provides some flexibility, machines and employees should both provide some degree of flexibility, moderate delivery times, consistency and high performance design possible, possibly assemble to order. Use when standardized items that have some options, industries with moderate evolution rate. Strengths- mass customization some flexibility and some speed, adjust quickly to changing market conditions. Weaknesses- may have to compete against both generic and luxury, can get caught in the middle |
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Term
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Definition
| General Growth Properties, Inc. selected a layout that clustered competing stores together, to make shopping more convenient and compete against online shopping better. Some malls are trying to make more high-tech directories. |
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Term
| 4 questions to ask in layout planning |
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Definition
| what centers should the layout include? How much space and capacity does each center need? How should each center’s space be configured, where should each center be located? |
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Term
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Definition
| a layout that organizes resources (employees and equipment) by function rather than by service or product. Used when operation must intermittently serve many different customer types or manufacture many different products or parts. Where job content requires a good deal of technical knowledge and higher equipment utilization. Most difficult is what to put in centers |
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Term
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Definition
| a layout in which workstations or departments are arranged in a linear path. Resources are arranged around the customer’s or product’s route rather than shared across many of them. |
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Term
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Definition
| an arrangement in which some portions of the facility have a flexible-flow layout and others have a line-flow layout. |
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Term
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Definition
| an arrangement in which the service or manufacturing site is fixed in place: employees, along with their equipment, come to the site to do their work. |
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Term
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Definition
| Customer Satisfaction, level of capital investment, requirements for materials handling, ease of stockpicking, work environment and “atmosphere”, ease of equipment maintenance, employee and internal customer attitudes, amount of flexibility needed, customer convenience and level of sales. |
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Term
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Definition
| an option for achieving line-flow layouts with low-volume processes; this technique creates cells not limited to just one worker and has a unique way of selecting work to be done by the cell. Puts products with similar characteristics into families. Example- Look at figure 4 (pg 61 of Marble) |
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Term
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Definition
| various ways of utilizing space offer additional layout options. Different layout patterns like out-and-back pattern where there is an aisle and a dock at the end, usually high-volume items are stored closest to the dock. Route-collection system- the stockpicker selects a variety of items to be shipped to a customer. Batch-picking system- stockpicker gathers the quantity of an item required to satisfy. Zone system- stockpicker gathers all needed items in her assigned zone and places them on a conveyer line. |
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Term
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Definition
| the maximum time allowed for work on one unit at each station. |
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Term
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Definition
| how long it takes the slowest station to complete their job. You are only as strong as your weakest link! |
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Term
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Definition
| how many units in a certain amount of hours. Number of seconds in the certain amount of hours divided by the cycle time (in seconds) = how many units in the certain amount of hours. |
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Term
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Definition
| taking the basic tasks/work elements of the process and combine them into individual jobs, preserve the required precedence relationships and meet the desired output rate. TM- Theoretical number of workstations according to formula. (smaller decimal, more probably to move things around) n= actual number of workstations, may be higher than what the formula indicates. Balance a line by trying to make the most efficient use of workstations and time. Identify workstation candidates, choose one of the candidates for placement, does it fit in the work station? |
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Term
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Definition
| one process in a chain of processes, such that its limited capacity reduces the capacity of the whole chain. |
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Term
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Definition
| a performance metric used to measure the customer service in a supply organization. |
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Term
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Definition
| a benchmark or goal for the smallest number of stations possible, where the total time required to assemble each unit is divided by the cycle time. |
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Term
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Definition
| the total unproductive time for all stations in the assembly of each unit. number of stations times the cycle time minus the total standard time required to assemble each unit |
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Term
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Definition
| the smallest units of work that can be performed independently |
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Term
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Definition
| work elements that must be done before the next element can begin. |
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Term
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Definition
| - a diagram that allows one to visualize immediate predecessors better; work elements are denoted by circles, with the time required to perform the work shown below each circle. |
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Term
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Definition
| the movement of product from one station to the next as soon as the cycle time has elapsed. |
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Term
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Definition
| free flowing cargo, stored loose, loaded by shovel, pump, bucket or scoop. Examples- coal, rice, grain, raw sugar, oil, sulfur. As you package it, it becomes breakbulk cargo |
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Term
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Definition
| general or packaged cargo, often containerized and measured in TEU’s |
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Term
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Definition
| characteristics of both bulk and break bulk. Examples- automobiles, logs, steel and cattle. |
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Term
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Definition
| when all of the space in the container (or package) has been filled |
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Term
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Definition
| when the container (or package) has been filled with product, such that additional cargo will exceed the container’s weight limit. |
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Term
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Definition
| seamless multimodal shipment. No need to unload container. Repackage products. One container for entire trip. (example- if the train has the back of a truck on it) |
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Term
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Definition
| use of more than one mode of transport during a single shipment |
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Term
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Definition
| set up a new logistics system in response to customer needs. Plant-based warehouses allow customers to place orders for direct plant shipments with any of plants. Regional mixing centers hold the entire line of Kraft products, strategically located to provide overnight shipments to max. number of customers. |
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Term
| Logistics is critical because |
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Definition
| for many firms, logistics expenses now are second only to material costs in terms of their impact on cost of goods sold. Information system advanced and globalization of markets are creating challenges and opportunities for logistics. Has a profound impact on other performance dimensions like delivery. Customer expectations are also causing a need for more developed logistics. |
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Term
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Definition
| schematic drawing that illustrates product placement. Store chains want stores to be nearly identical so easy on customer and employees. Help maximize shelf space. Planogram needs to think about shelf space, product variety, store variety. Effects containers used for products because they must fit and be space effective. Packaging specialists need to consider product characteristics, packaging trade-offs, destination, logistics itinerary (how is it getting there?), legal considerations, economic (how much?) |
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Term
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Definition
| in contact with the end item (plastic bag, can, bottle, shrink wrap) |
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Term
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Definition
| contains end item and primary packaging (box, case, drum, shrink wrap) |
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Term
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Definition
| contains several items which are in secondary packaging (crate, pallet, metal straps, shrink wrap) |
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Term
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Definition
| Used to fill the empty space inside boxes, tubes, etc. (air bubble, popcorn packaging, etc.) |
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Term
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Definition
| Full truckload and full container load. Can fill a whole container by yourself (non-stop flight, 1 party cab rides) |
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Term
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Definition
| Less than a truck/container load. Small shippers often cannot fill a container (sharing a cap, multiple stops) |
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Definition
can make everything else the same size for everything. Trucks, trains, storage, etc. So loading equipment can be standardized, easier to plan pallet arrangement inside container when all are nearly identical in size.
8 by 8.5 by 20 “20 footers”
8 by 8.5 by 40- “40 footers”
8 by 9.5 by (20 or 40)-“High cubes”
Interior – 7.7 by 7.83 by 19.35 (or 39.4)
Measured in TEU’s = Twenty-foot equivalent unit. (20 footer = 1 TEU, 40 footer = 2 TEU’s) |
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| Typical Types of Containers |
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Definition
Controlled Atmosphere containers, Flat Bed (open sides), Ventilated, Open Top
Advantages of Controlled Atmosphere containers- Delay aging/ripening process, reduce water loss and weight shrinkage, longer transit times possible, eliminates insects/bacteria/decay, harmful gases removed |
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Term
| TOFC, COFC and Double-stacks |
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Definition
TOFC- Trailer on a Flat Car (piggyback service)
COFC- container on a flat car
Double-stacks- two containers on a railcar |
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Definition
| roads and rail networks, ocean ports and airports, intermodal capabilities- handling devices, warehouses, natural resource distribution/utility network, communication network, labor-skill/education level, legal landscape-legal environment. We are good all around, but not the best, we have all of the options. Infrastructure is important because it helps with planning and making sure things go smoothly. |
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Definition
| one of the most flexible modes of transportation, has also become more cost effective, very few goods are moved without highway transportation at some point, better scheduling and use of vehicle capacity, better vehicles and increased cost competition due to deregulation. Neither the fastest nor the cheapest. |
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Definition
| about 21 percent of all ton-miles shipped in US, better for materials with high weight-to-value ratio, one of the lowest ton-mile rates, slower speeds. Limited locations, poor delivery reliability/speed. |
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Definition
| ideal for low weight-to-value ratio, especially if delivery speed is critical. Grew explosively between 1993 and 1997 in terms of value of goods ton-miles shipped. Often most expensive. |
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Definition
| cost similar to water, but somewhat more flexible. By 2000 rail’s percentage of ton-miles shipped had grown to 39%. Highly cost effective for bulky items, but limited locations. |
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Definition
| provides storage (inventories, closer to retailers, shorter lead times), whereas distribution centers facilitate movement (LTL to TL- consolidation, lower cost, product mixing). Warehouse/DC Strategies- storage, consolidation and sorting, picking and packing, labeling, value added labor activities, reverse logistics activities. |
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Term
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Definition
Product Mixing- (old school, backup inventory) slow mixing centers. Traditional distribution model. Some for the retailers, some for warehouses to provide a buffer against errors and market changes.
Cross Docking (modern warehousing)- fast mixing centers. A more modern distribution system that takes advantage of technological advantages of this age. Move inventory quickly.
Outbound Consolidation- assembly and/or packaging of end item. Used when end item is made up of multiple components produced at separate locations. The packed end item could then possibly enter additional distribution systems. |
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Term
| Consolidation Watehousing |
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Definition
| a form of warehousing that pulls together shipments from a number of sources (often plants) in the same geographical area and combines them into large and more economical shipping loads. |
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Definition
| a form of warehousing in which large incoming shipments are received and then broken down into smaller outgoing shipments to demand points in a geographic area. Cross-docking combines the economies of large incoming shipments with the flexibility of smaller local shipments. |
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Definition
| a specialized form of cross docking in which the incoming shipments are from a single source or manufacturer |
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Term
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Definition
| a form of warehousing in which strategically placed “hubs” are used as sorting or transfer facilities. The hubs are typically located at convenient high-traffic locations. The “spokes” refer to the routes serving the destinations associated with the hubs |
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Definition
| a form of warehousing that combines classic warehouse operations with light manufacturing and packaging duties to allow firms to put off final assembly or packaging of goods until the last possible moment. |
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Definition
| a form of warehousing in which a wide array of goods is held close to the source of demand in order to assure short customer lead times |
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Definition
| a form of warehousing that attempts to position seasonal goods close to the marketplace. At the end of each season, the goods are either liquidated or moved back to a more centralized location. |
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Term
| Materials handling systems |
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Definition
| the equipment and procedures needed to move goods within a facility, between a facility and a transportation mode, and between different transportation modes. |
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Definition
| from a logistics perspective, the way goods and materials are packed in order to facilitate physical, informational, and monetary flows through the supply chain |
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Definition
| • When Cross Docking, Lowe’s uses sophisticated conveyer system to move products to trucks. Workers place outgoing items into standardized trays, each with a barcode indicating final destination. Conveyer system reads bar codes and automatically routes trays to appropriate trucks. Fast and accurate and minimizes labor costs. Can handle only those that fit into tray. |
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Definition
| many now ship wine in reinforced, vacuum sealed plastic bags. Cost less to ship and handle and keep wine fresher. Greater product flexibility. Can quickly be repackaged into bottles. |
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