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What can other members use? A methodology for estimating the cost of service levels. - PowerPoint PPT Presentation


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10 % Complete. Modeling a Conversion of Suppliers from Prepaid to Collect (P2C) System Research Team: Dr. Sarah Root (PI), Dr. Russell Meller, Prabuddha Lohani. 0%. 100%. Sponsor: Sam’s Club Thrust Area: Distribution Problem in context:

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10 % Complete

Modeling a Conversion of Suppliers from Prepaid to Collect (P2C) SystemResearch Team: Dr. Sarah Root (PI), Dr. Russell Meller, Prabuddha Lohani

0%

100%

  • Sponsor: Sam’s Club

  • Thrust Area: Distribution

  • Problem in context:

  • Sam’s is looking to move more of its suppliers from prepaid to collect.

    • Identify opportunities to reduce costs by moving to collect terms

  • The quantitative tradeoff between different level of service (4- day window, 5-day window ) and the cost is unknown.

    • Important/Expected Results:

    • Develop a model to estimate baseline inbound transportation cost increases as a result of P2C conversion.

    • Help in prioritizing the suppliers who should be converted from prepaid to collect.

    • Construct model to estimate the effect of MABD on transportation cost.

    • Validation of model, working toward a larger implementation.

    • Technical Approach:

    • Data collection and analysis

    • Formulation of strategy

    • Mathematical modeling of operational problems

    • Sensitivity analysis

    • Documentation

    • What can other members use?

    • A methodology for estimating the cost of service levels.

    • A model to prioritize and estimate supplier transportation cost, and savings that result from P2C conversion.

    • Recommendations showing potential ways to off set the cost increases with the benefits of controlling the inbound flow to bring efficiencies.

    Project # UA10 – Sam’s Club


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