Supply Chain Basics
The linkage of all activities from supplier to customer.
What is a supply chain?
The first step to determine warehouse space needs.
What is forecasting customer demand?
The first step in ABC inventory analysis
What is determining annual usage of each item?
The ultimate objective of a logistics system.
What is maximizing customer service?
A reason to outsource warehousing (e.g., "not our core competency").
What is focusing on internal expertise?
Walmart’s key to distribution success (e.g., "strategic warehouse locations")
What is proximity to urban customer areas?
The major benefit of cross-docking.
What is reduced warehouse space needs?
The term for cycling inventory levels timely.
What are inventory turns?
A least important customer service measure.
What is number of excess inventory items?
A value-added service (e.g., "kitting").
What is packaging/bundling for customers?
Caterpillar’s reason for large spare parts inventory.
What is preventing costly customer downtime?
The most complex inventory to control across many warehouses.
What are finished goods?
The difference between excess and obsolete inventory.
What is excess being potentially saleable?
The key consideration for performance metrics.
What is aligning with company strategy?
A disadvantage of fully automated order systems.
What is no human review of decisions?
The LEAST concern for warehousing strategy (e.g., "number of production staff").
What is internal headcount?
Why returns are handled separately from main warehouses.
What is avoiding operational disruption?
A non-factor in bulk purchase decisions.
What is shipment packaging?
DRP’s critical requirement.
What is accurate demand forecasts?
A non-factor in choosing a 3PL.
What is number of employees?
The major objective of a delivery system.
What is maximizing customer service?
The biggest problem with adding distribution links.
What is increased handling costs?
Why firms avoid high inventory levels.
What is higher carrying costs?
The best approach to a time-critical logistics issue.
What is understanding customer needs?
An advantage of 3PLs (e.g., "lower storage costs").
What is cost efficiency?