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Logistics Network |
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 Implementation Services.. |
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Consulting Services |
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Integration Services |
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Logistics Network Optimization |
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Network Item Stocking Strategies |
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Business Case Development |
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Transportation Analysis, Carrier Evaluation |
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Management Services |
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3PL / Direct Warehouse Analysis |
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Cost and Service Benchmarking |
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Training Services |
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Inventory & Order Cycle Analyis |
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Trading Partner Collaboration |
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Implementation RoadMap |
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Logistics Network Optimization |
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Logistics Network Optimization (LNO) has become more prevalent in today’s supply chain as companies endeavor to configure their manufacturing and distribution networks to achieve an optimal balance between service levels and logistics costs. If executed properly, network optimization has the potential to significantly increase savings in warehouse, transportation and inventory operations, and yield substantial service improvements that may not otherwise be realized. |
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Network modeling can be very complex depending on the scope of your supply chain and requires a comprehensive understanding of your business objectives and overall corporate strategy. Identify viable supply chain alternatives to support the company’s strategic growth plans; determine the locations, facility types and approximate sizes, and shipment modes required to support the optimized model; determine the potential cost and operational efficiencies gained by managing inventory and transportation aspects of procurement in the context of a different physical network; and evaluate the impact of changing market conditions, adding new customers and products, regional demand or new customer service offerings are just a few objectives to consider while developing your LNO strategy.
A complete and thorough LNO study should address such questions as: |
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• What geographic mix of facilities will best support future growth from a cost and service perspective? |
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• What network provides the best balance of warehouse and transportation operating expenses, inventory carrying costs and capital investment requirements for the next decade? |
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• Where should our distribution centers be optimally located? How many should we have? What should the role of these facilities be? What size should they be? |
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• Which SKUs create the most inventory assets and what is the financial impact of centralizing stock for the highest value items? |
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• Which SKUs are time sensitive and need to be positioned closet to market to maximize our competitive position? |
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• Internal or external (3PL), or combination? |
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4SIGHT’s skilled team of professionals employs a three-phased approach in LNO planning: Discovery, Modeling and Strategy. After the Discovery phase, our experts will help identify the “right” optimization tool based on your unique business needs. |
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4SIGHT’s LNO methodology is driven by several key success factors. First, define scope early by agreeing upon the project objective, considering questions the company wants to address with the study and discussing viable supply chain strategy considerations. Second, remember, data is king. The ability to get clean, accurate data drives costs and timeframes. It’s common to have to make data assumptions and/or find a way to retrieve data. Third, rationalize SKU service requirements early in the process. Once these requirements have been agreed upon, look at opportunities to deploy inventory differently across the network. Fourth, start with a high level analysis of each strategy before doing the detailed work – throw out the scenarios that generate marginal results. Finally, develop the detailed capacity and financial models outside of the modeling tool to obtain buy-in across the organization. |
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Contact 4SIGHT to learn more on how we can help with your Logistics Network needs! |
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BLOG | CONTACT US: (201) 940-7311
