11DSCI4743 Physical Distribution Definition Physical distribution is the movement & storage of finished goods from the end of production to the customer.

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11DSCI4743 Physical Distribution Definition Physical distribution is the movement & storage of finished goods from the end of production to the customer One person’s distribution is another person’s supply

22DSCI4743 Supply Chain (Logistics System) SUPPLIERSSUPPLIERS MANUFACTURER DISTRIBUTION SYSTEM CUSTOMERCUSTOMER Physical Supply Manufacturing Planning and Control Physical Distribution DOMINANT FLOW OF PRODUCTS AND SERVICES DOMINANT FLOW OF DEMAND & DESIGN INFORMATION

33DSCI4743 Activities in Physical Distribution Transportation: Accounts for 30-60% of dist. Costs, adds place value Distribution Inventory: Accounts for 25-30% of cost, adds time value Warehouses (distribution centers): Store inventory Materials Handling: Moves goods Protective Packaging Order Processing & Communication

44DSCI Modes of Transportation Rail Large fixed investment, good for bulky commodities over great distance

55DSCI Modes of Transportation Road Relatively small investment, fast, flexible service for small cargoes

66DSCI Modes of Transportation Air High capital costs, high variable costs, high speed of service & flexibility

77DSCI Modes of Transportation Water Low costs, fixed costs absorbed over large volumes

88DSCI Modes of Transportation Pipeline High capital / low operating costs Very high volume Obviously for viscous products

99DSCI Modes of Transportation Multi-Modal Ship – Rail – Truck Ship – Truck Rail – Truck Air – Truck Pipeline – Truck

10 DSCI Modes of Transportation Each of these 5 modes of transportation have: WAYS TERMINALS VEHICLES (except pipelines).

11 DSCI4743 Logistics Information Systems Location Loading Routing Schedule Volume

12 DSCI4743 Transportation Cost Elements Line-haul Pickup & delivery Terminal handling Billing & collecting

13 DSCI4743 Shipping Patterns Number of customers Geographic distribution of customers Customer order size Number & location of plants & distribution centers

14 DSCI4743 Roles of Packaging Identify the product Contain and protect the product Contribute to physical distribution efficiency In many applications, the environmental impact of packaging is significant.