At Tholmann DMCC, we work with clients to implement the best strategy for their company. Cost effective supply chain operations start by determining the optimum infrastructure. If the number and size of warehouses or cross dock facilities is incorrect or they are in the wrong place the supply chain will not operate at maximum efficiency.
Challenges
For some operations, the optimal infrastructure solution is relatively self-evident, and easy to determine, while for others arriving at the correct solution can be very challenging. This is particularly the case with operations involving international supply chains, where the trade-off between transport and warehousing costs is finely balanced or the trade-off between different manufacturing methods and logistics is not straightforward. To cope with the complexity of the problem many companies simplify the task, and resort to ‘averages of averages’, and this can lead to important details being missed and an incorrect solution achieved.
Approach
We have developed our own mixed integer infrastructure model to evaluate a range of possible operational solutions quickly and cost effectively.
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Typical uses of the model include the following:
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Determining the optimum size and location of warehouses
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Determining the optimum use of cross dock facilities
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Determining use of consolidation centers
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Determining optimum stock levels by product group
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Determining which products should be stored in which warehouse
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Understanding individual and customer profitability
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Evaluation of alternative customer service levels
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Evaluation of alternative ’what if scenarios’
All infrastructure modelling project commence by configuring the model to address the evaluation required. Data is normally taken at order line level to capture daily and seasonal variations. Costs and productivity standards can either be provided by the client or, if they are not available, we will use our own.
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Once the model has been configured and populated with the necessary data it is a relatively straightforward task to run a series of iterations in order to evaluate and refine possible solutions.
THOLMANN DMCC
Tholmann DMCC is an international consultancy providing Independent, Objective Expertise in Supply Chain and Logistics.
ABOUT US
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Tholmann DMCC is an expert advisory firm specializing in supply chain & logistics strategy, planning and execution. We offer advisory, professional services, supply chain systems, outsourcing, and benchmarking across a broad range of industries.
Contact us
Office 604, Indigo Tower, Cluster D,
Jumeirah Lakes Towers, Dubai,
United Arab Emirates
Telephone: +971 (0)4 583 2874
Email: hello.dubai@tholmann.com
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