How should the DCs order from suppliers?
How often should shipments be made to each customer?
What should theservice levels be?
9. Which transportation methods should be used?
Depending on the market needs of a company and its overall supply chainmission, the answer to question 1 may necessitate adding one or more DCs to the network, or conversely, it may require consolidating several DCs into a single regionaldistribution hub.
A SITE FOR SORE EYES
When you get right down to it, all logistics (like all politics) is local. HP, as noted earlier,maintains 88 distribution hubs throughout the world. IBM Corp. has at least one major logistics site on every continent in the world except for Africa, and 28 in all.The Gillette Co. has four distribution centers in the United States and 60 total worldwide. In the United States alone, retail behemoth Wal-Mart has 128distribution centers strategically located in 38 states.
And yet, there's a feeling that the site selection process is more art than science, more luck thanstrategy. Determining exactly where in the United States a company should locate its logistics and distribution centers requires a study of many factors beyond justtransportation costs (although transportation is a major factor in the decision).
For many years, Expansion Management, a magazine that specializes in siteselection, has teamed up with Logistics Today (the author's publication) to produce the Site Selector— a tool that offers an objective ranking of the 362 major U.S.