Business Logistics

Business Logistics Inbound Logistics/Materials Management

Material Management is..... • ___________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

Goals Of Materials Management • Anticipate materials requirement • Sourcing and obtaining materials • ___________________________________ • ___________________________________

Material Management Functions • Procurement/Purchasing • Production Control • Inbound Logistics • Warehousing and Storage • Data and Information Systems • Inventory Planning • Material Disposal/Salvage

Administration and Control of Material Flows • Must be able to measure, report and improve performance of process • Areas to be monitored include: • service levels • inventory levels • price levels • quality control • budget vs actual performances

Procurement vs Purchasing • Procurement:_________________________________________________________________________________________________________________________________ • Purchasing: _________________________ _________________________________________________________________________________________________________

Uninterrupted flow of goods Keep inventory investment at a minimum Maintain adequate quality Find and develop sound suppliers Standardize items bought purchase at lowest possible cost Improve company’s competitive position __________________ __________________ __________________ Goals Of Purchasing

Factors To Be Considered In Making A Purchasing Decision • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________

Steps In The Process.... • Identify or reevaluate needs • Define and evaluate user requirements • Decide whether to make or buy • Identify buying situation: • Routine buying situation • Procedural problem situation • Performance problems situation • Political problem situation

Steps In Process (cont’d) • Conduct a market analysis • Identify all possible suppliers • Prescreen suppliers • Evaluate remaining supplier base • Chose a supplier • Receive delivery of product • Make a post-purchase evaluation

Supplier Selection Criteria • Quality • Reliability • ___________________________________ • ___________________________________ • ___________________________________ • ___________________________________ • ___________________________________

Types Of Pricing .... • Commodity markets:__________________ ___________________________________ • Price lists: __________________________ ___________________________________ • Price Quotations: ____________________ ___________________________________ • Negotiations: ________________________ ___________________________________

Elements Of Costs: • Actual cost of the good or service • Direct transaction costs • Supplier relationship costs • __________________________________ • __________________________________ • __________________________________ • __________________________________

The JIT Approach • JIT Defined • Changes and Benefits From JIT • Several Examples...Xerox and Ford Motor • Problems Associated With JIT

A JIT Approach To Inbound... • ___________________________________ • ___________________________________ • ___________________________________ • ___________________________________ • ___________________________________ • ___________________________________ • ___________________________________

Conventional:_________________________________________________________________________________________________________________________________________________________________________Conventional:_________________________________________________________________________________________________________________________________________________________________________ JIT Approach: __________________________________________________________________________________________________________________________________________________________________ Conventional VS JIT Approach

Benefits Derived From JIT... • ___________________________________ • ___________________________________ • ___________________________________ • ___________________________________ • ___________________________________ • ___________________________________ • ___________________________________

Some Success Stories • Xerox: _____________________________ _________________________________________________________________________________________________________ • Ford Motor: _________________________ _________________________________________________________________________________________________________

However, All Is Not Well In The JIT Fantasy Kingdom... • ___________________________________ • ___________________________________ • ___________________________________ • ___________________________________ • ___________________________________ • ___________________________________ • ___________________________________

What Are MRP Systems???? • MRP is:_____________________________ _____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

When Does MRP Make Sense??? • _________________________________________________________________________________________________________ • _________________________________________________________________________________________________________ • _________________________________________________________________________________________________________

Advantages:________ __________________________________________________________________________________________________________________________________________________________________ Disadvantages: _____ __________________________________________________________________________________________________________________________________________________________________ Advantages and Disadvantages of MRP Systems

DRP and DRP II Systems • DFP/DRP II defined: __________________ _____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

Marketing Benefits of DRP II Systems include: • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________ • __________________________________

Logistics Benefits From DRP II • ___________________________________ • ___________________________________ • ___________________________________ • ___________________________________ • ___________________________________ • ___________________________________ • ___________________________________

That About IT For This Week!! See ya all NEXT WEEK for Chapter FOUR!!!!!

Business Logistics