1. 1 The wonderful world of LOGISTICS STEFAN NYSTRÖM

2. 2 LOGISTICS AGENDA F The macrophilosophy F History F Logistics within the company F Working as a logistician

3. 3 WHAT IS LOGISTICS ? F Approach and principles to plan, organize, coordinate, direct and control the flow of material from rawmaterial supplier to end consumer.

4. 4 THE LOGISTIC CHAIN

5. 5 PRIMARY GOAL ? PROFITABILITY RECIPE: 1. Flexible manufacturing 2. Quick distribution

6. 6 the DuPont Chart SALES +GROSS COST OF PROFIT SALES -NET PROFIT DEPRECIATION - OTHER /NET PROFIT FINANCIAL EXPENSESMARGIN INCOME +SALESxRETURN ON INVESTMENT CURRENT /INVESTMENT ASSETSTURNOVER + INVENTORIESTOTAL +INVESTMENTS FIXED AND OTHER ASSETS

7. 7 HISTORY F French general, Marquis de Longis, planning the supply of the front line, late 17th century. F World War 2, invasion in Normandie. F ’Desert storm’, 10.000.000 tons of arms ammunition and materials from USA and Europe.

8. 8 MARKETING MIX Philip Kotler 4P F PRODUCT F PRICE F PROMOTION F PLACE

9. 9 COST APPORTIONMENT Production Distribution F 1800 F 1900 F 2000

10. 10 LOGISTICS within the company The ´Pipe´syndrom

11. 11 INVENTORY

12. 12 WHY INVENTORY ? F Lead time is longer than promised delivery time F Seasonal fluctuation in raw materials F Seasonal fluctuation in demand F Achieve transportation economy F Forecast errors F Achieve production economy F Advantage of quantity purcase discounts

13. 13 ABC - classification

14. 14 Purchasing Economic Order Quantity or the ’Wilson formula’ Q = 2KD VW Q = Optimum purchase quantity K = Cost per order D = quantity needed per period V = value of product per unit W = Storage cost / 100 ( Internal interest rate)

15. 15 Purchasing, scheme. Purcasing quantity Cost Cost per order Total cost Storage cost Economic order Quantity

16. 16 Purchasing, safety buffer Leadtime Safety buffer Ordered quantity Time Stock Ordering point

17. 17 Purchasing, philosophies F Closer relationships seller - buyer F Outsourcing F Customer ordered production F Just - in - time philosophy F Computer aid through MRP-systems (Materials Requirements Planning) F VMI ( Vendor Managed Inventory) F Selfbilling

18. 18 Production F JIT F TQC F Flexible manufacuring F Kanban F Shorter adjustment times F Simplify things F Lean

19. 19 Rationalization of capital Rawmtrl.Production Factory warehouse Transport Terminal Time Capital tied up

20. 20 Customer service F What does our competitors offer ? F Vhat does our customer demand and what does he need ? F What does a higher service level give in higher sales ? F What will it cost us ? Cost Income Profit Service currency

21. 21 The purpose of a logistic system F the right product F in the right amount F at the right place F at the right time F at the right cost

22. 22 The logistic chain,again! Information system ComponentsInventory Supplier Customer Purchasing Manufacturing Distribution

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