Cost effective and responsive supply chain network design using Facilities Location planner

February 21, 2022by scmw0

A common problem for large process-based manufacturing organizations with geographically wide distribution is the need to rationalize the economy of scale in production with a large and complex supply chain network. There is a trade-off between the economy of scale achieved through increased production at a more distant site versus additional transportation costs involved. Most industries face conflicting pressures to take advantage of significant production economies of scale on the one hand and be customer responsive through fast and lean distribution systems on the other hand. SCMworx experienced consultants backed with complex mathematical models based on Operations Research can help these organizations evaluate and finalize different strategic decisions like facility locations, line (technology) selection at each facility and tactical decisions like product mix on each line, quantity to be supplied from each plant to depot and depot to market. Candidate options of plants and depots, annual demand for different products at different demand centers, fixed and variable costs, transportation costs, taxes are some of the inputs required for analysis.

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