What Factors Would Affect Distribution Network Design?

By Carl Cox

Among the many elements of commerce, perhaps none has changed as drastically as logistics has over the last few decades. The modern supply chain now has to deal with competitive pressures, huge product lines and huge expectations from the market. Handling this continuum of change is key to ensuring a business remains profitable in both the short- and the long-term. And to do this effectively, the factors that greatly influence distribution network design must be considered when updating operational models.

The unpredictable elements that characterize the modern business environment must be taken into account while developing a distribution network. Here, you need to take into account both planned and unplanned events that may have an impact on your operations. Perhaps the biggest inhibitors to flexibility are the equipment and operations that support the supply chain. The capability to exploit emerging channels and uphold efficiency can only be acquired with versatile resources. So even if it means putting up with some hiccups in the short term, carry out the radical changes required to update your distribution facilities and tools.

A dynamic supply chain is one developed with the global market in mind. All nodes within your logistics network have to support a global end-to-end strategy. During the streamlining process, pay special attention to incoming raw materials and outbound products. Customer service functions may also need to operate round-the-clock to assist individuals in various time zones.

Just as government policy has an effect on business, logistics managers have an obligation to be involved and aware of laws that involve their niches. Rules on taxation, infrastructure and labor are constantly changed on all levels of government. Without the right input, uninformed decisions could dramatically affect supply chain operations. So it's important to not only familiarize yourself in the regulations, but also take up an active role in the formulation of these policies.

The days of keypunching in logistics activities and arduous paperwork are fast becoming a distant memory. In today's digital world, information needs to be delivered precisely and promptly. Modern distribution execution systems come packed with standardized features and real-time interfaces. To keep up, you need to invest in industry-tailored programs that will facilitate smoother processes.

Businesses that aren't able to speedily fulfill orders can't be competitive for long. An efficient, quick supply chain is highly critical, especially in this digital era. From vendor compliance to execution systems, your entire logistics network needs to keep pace with current e-commerce speeds. Streamlining your distribution nodes would greatly help in matching your clients' expectations. Besides, you'll be better placed to account for the increased inventory turnover, short product lives and other elements that characterize modern commerce.

Accountability is absolutely crucial in distribution departments. And it's the responsibility of managers to make the difficult calls needed to enforce accountability. When outlining related protocols, care must always be taken that each policy works for the good of the entire organization.

Even the most advanced supply chains need constant optimization to keep up with upcoming developments. Redeveloping your logistics network periodically will help you face whatever the market throws your way. Engaging an experienced consultant in the process is crucial in guaranteeing the success of your project.

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