LOGISTICS FINAL EXAM

Q4: SUPPY CHAIN

A supply chain is a group of partners who collectively convert a
basic commodity (upstream) into a finished product
(downstream) that is valued by end-customers, and who
manage returns at each stage.
Each partner in a supply chain is responsible directly for a
process that adds value to a product.
A process may be defined as follows: Transforming inputs in
the form of materials and information into outputs in the
form of goods and service
Supply chain management : Planning and controlling all of the processes
that link partners in a supply chain together in order to serve needs of the
end-customer. The focus of managing the supply chain as a whole is on
integrating the processes of supply chain partners, of which the endcustomer is the
key one.
Supply chain management – boundaries and relationships:
Supply chain management is an integrating function with primary
responsibility for linking major business functions and business processes
within and across companies into a cohesive and high-performing business
model.
It includes all of the logistics management activities, as well as
manufacturing operations, and it drives coordination of processes and
activities with and across marketing, sales, product design, finance, and
information technology
COMPARE BETWEEN LOGISTIC AND SUPPLY CHAIN
  Three basic ways of creating logistics advantage:
Quality advantage:
Most visible part of supply chain performance
Defects, late deliveries, and unavailability are symptoms of quality
problems influence negatively customer’s loyalty
Concerns product quality and quality of service
Time advantage:
Time measures how long a customer has to wait in order to receive a
given product or service
Customer to customer lead time: the time it takes from the moment a
customer places an order to the moment that customer receives the good
If zero: product immediately available on supermarket shelf
Speeding up supply chain processes may help to improve freshness of the
end product or reduce risk of obsolete or over-aged stock in the system
By following a product through a supply chain, we can discover which
processes add value and which add time and cost but no value.
Cost advantage:
Cost is important for all supply chain processes
Low costs low prices or high margins or a bit of each
Many products compete specifically on the basis of low price
Q5:
1.4. Optimizing supply chains
1.4.1. Logistics costs
Selling price – breakdown of costs:
Production costs: » 40% to 60%
Purchase costs raw materials
Transformation
Logistics costs: » 10% to 20%
Marketing and sales costs: » 15% to 20 %
Margin/profit: » 5% to 15%
1.4.2. Role of inventory costs
Inventory costs:
Purchase cost
Cost of carrying inventory:
Storage costs:
-Cost of putting away stock receipts and moving material within the
warehouse. (How much of your employees' time is spent in these
activities?)
-Rent + utilities for the portion of your warehouse used to store stock
inventory.
-Insurance and taxes on inventory.
Inventory shrinkage and obsolescence.
Opportunity cost of the money invested in inventory.
(How much could you make if you were to take the money you're
investing in inventory and invest it in a more traditional investment? If you
are financing your inventory, how much interest are you currently paying
the bank?)
Ordering costs
Out-of-stock costs
1.4.3. How to reduce inventory costs?
Reduce volumes to be stocked
Improve forecasts in order to reduce security stock
Reduce the size of orders, of production units, of deliveries and
increase their frequencies (Just-in-time)
Stocking upstream in the logistics chain rather than downstream:
Reduce time necessary for operation situated downstream in the
logistics chain (e.g. order preparing)
Place certain operations rather downstream in the logistics chain
(e.g. postponement)
Synchronize operations (Just-in-time)
TRẮC NGHIỆM
Traditional production schemes
Push model is a method for organizing production according to market
demand forecast. This method creates the inventory and "push" of the
market to meet the actual needs. The category of push system is that demand
is forecasted and production is scheduled before demand is there.
Just-in-time system (JIT)
Just-in-time: not too early, not to late
Based on pull model: Pull model based on the actual demands of customers
for production and distribution rather than forecast. It means that the
demands of the customer "pull" from the manufacture of goods on the
market. The company does not manufacture products before
receiving orders from customers

6. PL
1PL – First Party Logistics
• A first-party logistics provider is a firm or an individual that
needs to have cargo, freight, goods, produce or merchandise
transported from a point A to a point B. The term first-party
logistics provider stands both for the cargo sender and for the
cargo receiver
2PL – Second Party Logistics
• A second-party logistics provider is an asset-based carrier,
which actually owns the means of transportation. Typical 2PLs
would be shipping lines which own, lease or charter their
ships; airlines which own, lease or charter their planes and
truck companies which own or lease their trucks
3PL – Third Party Logistics
• A third-party logistics provider provides outsourced or 'third
party' logistics services to companies for part or sometimes all
of their supply chain management functions
4PL – Fourth Party Logistic
• A fourth-party logistics provider is an independent, singularly
accountable, non-asset based integrator who will assemble
the resources, capabilities and technology of its own
organization and other organizations, including 3PLs, to
design, build and run comprehensive supply chain solutions
for clients.
5PL – Fifth Party Logistics
• A fifth party logistics provider will aggregate the demands of
the 3PL and others into bulk volume for negotiating more
favorable rates with airlines and shipping companies. Non
asset based, it will work seamlessly across all disciplines
Supply Chain Facilitators
• Third-Party Logistics (3PL), also known as logistics outsourcing or
contract logistics
• Any logistics activity not performed in-house is representative of thirdparty logistics
• Common 3PL activities involve inbound and outbound transportation,
carrier negotiation and contracting, and freight consolidation
Supply Chain Facilitators
• Fourth-party logistics (4PL) or lead logistics provider (LLP)
• Refers to a company whose primary purpose is to ensure that various
3PLs are working toward the relevant supply chain goals and objectives
• Need to have the expertise to consider:
• Supply chain solutions and potential trade-offs
• Make constant objective decisions across a broad set of
• value-adding activities
7. các hình thức IFF
Method of Transportation of IFF
The Transportation fall into one of three basic types:
Land:
- Road haulage agent in road transport
Road transportation:
Mainly linked to light industries where rapid movements of freight in
small batches are the norm
+ Allows to go from door to door
+Pre and post transport by road although main transport may be by air,
sea, inland waterway or rail
+Road infrastructures are large consumers of space with the lowest level
of physical constraints among transportation modes.
+High pollution
- Railway agent or railway forwarder in railway transport
Rail transportation:
Railways are composed of a traced path on which are bound vehicles.
They have an average level of physical constrains linked to the types of
locomotives and a low gradient is required, particularly for freight.
Heavy industries are traditionally linked with rail transport systems,
although containerization has improved the flexibility of rail
transportation by linking it with road and maritime modes.
Rail is by far the land transportation mode offering the highest capacity
with a 23,000 tons fully loaded coal unit train being the heaviest load
ever carried.
Gauges, however, vary around the world, often complicating the
integration of rail systems
Water: maritime shipping and inland waterway. Loading
agent or shipping agent in connection with inland waterway or
sea transport
Inland waterway transport:
By rivers and channels
Little energy consumption
Not expensive but slow
Heavy industries are traditionally linked with inland
waterway transport systems, although containerization has
improved the flexibility of inland waterway transportation
by linking it with road and maritime modes
Maritime transportation:
Because of the physical properties of water, maritime
transportation is the most effective mode to move large
quantities of cargo over long distances.
Containerization transport of smaller quantities and over
shorter distances
High terminal costs, since port infrastructures are among the
most expensive to build, maintain and improve.
Not expensive but high inventory costs as it is slow
Air: Air freight agent or air freight forwarder in air transport
Air transportation:
High speed but expensive
Air activities are linked to high-value freight (high-tech
products, luxury goods), perishable goods (perishable by
destination, by nature), goods that are sensitive to temperature,
shocks…, goods that need to be moved in short delays
Air routes are practically unlimited
Air transport constraints are multidimensional and include
the site (a commercial plane needs about 3,300 meters of
runway for landing and take off), the climate, fog and aerial
currents
8. phân loại service và service air
Express service, Priority uplift (Expedited): short transit time
Standard service (Premier): normal transit time
Consolidation service (Value): longer transit time due to waiting
time for consolidation shipments