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8/10/2019 Sc Network

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SUPPLY CHAIN MANAGEMENT

Network Design in the Supply Chain (tambahan untuk memahami modul

supply chain network )


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Why Network Planning?

Find the right balance between inventory,transportation and manufacturing costs,Match supply and demand underuncertainty by positioning and managinginventory effectively,Utilize resources effectively by sourcingproducts from the most appropriatemanufacturing facility


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Network Design

Physical configuration and infrastructure ofthe supply chain.

A strategic decision with long-lastingeffects on the firm.Decisions relating to plant and warehouselocation as well as distribution andsourcing


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Key Strategic Decisions

Determining the appropriate number offacilities such as plants and warehouses. Determining the location of each facility. Determining the size of each facility.

Allocating space for products in eachfacility.

Determining sourcing requirements. Determining distribution strategies, i.e., theallocation of customers to warehouse


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Which market is served bywhich plant?Which supply sources areused by a plant?

x ij = Quantity shipped from

plant site i to customer jC ij = cost of producing and

shipping from plant site Ito customer j

D j = annual demand fromcustomer j

K i = capacity of plant i 0

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Demand Allocation Model


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Plant Location with MultipleSourcing

yi = 1 if plant is locatedat site i, 0 otherwisexij = Quantity shippedfrom plant site i tocustomer jf i = annual fixed costof keeping factory i open }1,0{;

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Plant Location with Single Sourcing

yi = 1 if plant is locatedat site i, 0 otherwisexij = 1 if market j is

supplied by factory i, 0otherwiseD j = annual demandfrom customer j

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Unit Distribution Costs

Facilitywarehouse

p 1 p 2 c 1 c 2 c 3

w 1 0 4 3 4 5

w 2 5 2 2 1 2


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Heuristic #1:Choose the Cheapest Warehouse to Source

Demand

D = 50,000

D = 100,000

D = 50,000Cap = 60,000

$5 x 140,000

$2 x 60,000

$2 x 50,000

$1 x 100,000

$2 x 50,000

Total Costs = $1,120,000


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The problem we want to solve is:min 0x(p1,w1) + 5x(p1,w2) + 4x(p2,w1)+ 2x(p2,w2) + 3x(w1,c1) + 4x(w1,c2)+ 5x(w1,c3) + 2x(w2,c1) + x(w2,c2) + 2x(w2,c3)

subject to the following constraints:x(p2,w1) + x(p2,w2) 60000

x(p1,w1) + x(p2,w1) = x(w1,c1) + x(w1,c2) + x(w1,c3)x(p1,w2) + x(p2,w2) = x(w2,c1) + x(w2,c2) + x(w2,c3)

x(w1,c1) + x(w2,c1) = 50000x(w1,c2) + x(w2,c2) = 100000x(w1,c3) + x(w2,c3) = 50000

all flows greater than or equal to zero.

The Optimization Model


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Optimal SolutionFacility

warehouse p 1 p 2 c 1 c 2 c 3

w 1 140,000 0 50,000 40,000 50,000

w 2 0 60,000 0 60,000 0

Total cost for the optimal strategy is $740,000

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