Design of the Distribution Network of the Company

Every company needs to establish policies regarding its distribution network, since this must be consistent with your market and optimum in responsiveness to mitigate fluctuations in demand.The complexity of the decisions regarding the design of the distribution network is such as it requires precise combination of facilities, transport modes and strategies.The design of distribution network is planning and strategic location of warehouses and distribution centers so as to allow to manage the flow of products from one or more sources to the customer. You need to develop an adequate network of stores for the company and customers and it requires the consideration of a significant number of elements. Number of stores, locations, property management or size thereof after having identified the needs of distribution and storage, company must decide what types of warehouses and distribution centers fit their needs more efficiently as well as their location.

Responsibilities of Warehouse Management

Once designed the distribution system, proceed to determine whether the store is to be self-managed or sub-contracted. Once again the decision depends on many factors depending on the strategy of the organization, its market size and supply chain, but there are clear advantages and disadvantages according to the type of management (own or subcontracting), within most significant are the following;

Warehouse Location

The location of the stores is approached from an approach double perspective such as;

  • A Market Overview to be bounded geographically over a wide area
  • A local market insight that includes particular aspects of the areas bounded in the overview.

Historically from the plane of industrial engineering has addressed the issue of the location of stores using multiple mathematical methods, among which are the methods including Hoover, Weber, Greenhut and method Center of Gravity. However, the factors are not merely quantitative and there are a lot of qualitative criterion which obviously result in financial terms.

Store Size

A warehouse must be sized primarily based on the products to be stored (in size, characteristics and number of references) and demand (especially in sectors affected by the seasonality of demand).But besides these, other factors that should be considered when sizing the size of a warehouse.Factors to be taken into account for calculating the size of a store are as under;

  • Products to store (quantity and sizes)
  • Market demand
  • Levels of customer service
  • Handling and storage systems to use
  • Production times
  • Scale economics
  • Layout of stock
    Corridor requirements
    Offices needed

It is important to consider the three dimensions to determine the capacity of the store i.e. determining the magnitude depending cubic meters. In the module design, size and layout of stores mathematically board the aspect known as sizing wineries.

Design and Layout of Stores

Once the types of stores and their locations have been defined, you should work on getting more efficient flow of materials and cash in stores. In this regard, an effective design optimizes a warehouse activities. You can click here to know more about this topic.

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