Distribution Diagnosis

You go to the doctor and tell him that your distribution hurts. He asks you to lie down and answer the following questions:

Do you want to increase the occupancy of your trucks?

Orders become increasingly smaller. To keep full truck loads it is necessary to group orders, e.g. within a region or within a delivery time window. Consider the transportation schedule at order acceptance. Also alert your planners if a truck is due to leave with insufficient load. They might be able to arrange additional cargo.

Are your leadtimes unacceptable to your customers?

In the 1980's every region had its own distribution centre, so the complete assortment was available near the customer. In the 1990's stock was centralised in European distribution centres which reduced the inventory considerably. Since the European borders opened, it was still possible to deliver within an acceptable leadtime. Nowadays, customers demand shorter leadtimes. This requires forward stock in depots near the customers. The forward stock is limited and satisfies demand until inventory is replenished from a stock holding warehouse.

Is your supply chain structure outdated?

Warehouses are no standalone sites anymore but should comprise a network. It must be possible to ship stock in any warehouse to any customer. This may include cross-docking and merge-in-transit to establish efficient transportation and order consolidation, respectively. Include the warehouses of your suppliers in this network and establish direct deliveries. Consider at order acceptance where the inventory is and promise a delivery date that you can achieve.

Do you want to track & trace your shipments?

For tracking & tracing it is necessary to register shipments at the various links in the supply chain, preferably by scanning barcodes. Subsequently, order and shipment information from various information systems should be combined. 

If it still hurts after two months, please make an appointment with a specialist.