Wednesday, June 29, 2011

4 Network Redesign Tips

Successful network design will always come down to the specific needs of your business, the needs of your customers, and the types of products moving through its veins. Our panel concludes that while there are a lot of options, there’s no silver bullet.

Tip # 1: One size does not fit all

The high-performing network is usually one that responds to the specific needs of each customer. This may involve designing and engineering a unique path flow for a specific customer or customer segment.

Tip #2: Get down to the nitty-gritty SKU level

Managers need to determine, at the SKU level, which products should go direct to store and which should go through DCs. You can figure this out once you know which product should be stocked and at which DC, including how much and where, and which product should be cross-docked.

Tip # 3: Being green can bring more green

The whole movement towards environmentally-friendly or green networks has certainly helped companies enhance their level of social responsibility—but it’s also saving them money.

Tip #4: Get creative with transportation

The biggest cost drain on distribution networks has typically been transportation costs; thus, finding creative low-cost ways to reduce these costs can certainly go a long way. Much of it involves collaborating and negotiating with trading partners and other carriers to create more efficient loads, eliminating “empty miles,” and achieving lower transportation costs overall.

Note: The original article provided 6 tips but I only included 4. I believe only those 4 are relevant to the local logistics industry.


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