Logistic Network Plan of a Central Warehouse



Network planning involves the development of a thorough blueprint of project outline which ensures that optimal returns are achieved while incurring minimal costs. The planning of supply logistics entails a comprehensive overview of a network plan to ensure optimal functionality (Mula, Peidro, Díaz-Madroñero, & Vicens, 2010). The supply logistic network plan entails components of inputs to a common warehouse and outputs to scattered outlet in a broad geographical location. The network plan targets to provide an optimum network approach to ensure the typical storage unit is well accessed by all the dependent stores as well as the primary sources to stocking the warehouse. The core focus of the paper is to develop a logistic network plan comprising of one common warehouse, ten scattered shop outlets and also three different stock deliveries to the warehouse.

Logistic Network Plan Breakdown

The development of the network plan comprises of crucial steps to ensure the ultimate goal is achieved. The step breakdown for the logistic plan facilitates the sufficient consideration of all the elements pertaining to the network scheme. The iteration process of developing the logistic plan ensures that critical analysis of the operationability of the project is done. The logistic network plan formulates the sequences and series of operation in a supply chain management from the merchants, to the central warehouse and then to the distribution channels that is the shopping outlets (Brandenburg, Govindan, Sarkis, & Seuring, 2014). Notably, the essence of the logistic network plan is the optimization of resources most importantly cost and time.

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Step 1: Project Orientation

The project orientation focuses on the objective and scope of the project laying down the vital details relating to the logistic network. The logistic plan to a general warehouse has a primary objective of ensuring that all the shop outlets are conveniently accessed from the warehouse. Apparently, the plan ensures that supplies are delivered to the shop stores at a minimal cost and at the precise time to avoid loss of customers (Melo, Nickel, & Saldanha-Da-Gama, 2009). Additionally, the convenience of the warehouse with reference to the six manufacturing sources is also paramount. The logistic blueprint has three major focus which is the suppliers (source), warehouse and distribution channels.

Step 2: Variables Definition

The definition of variable entails the identification of the input and output variables for the logistic plan. The input variables are the suppliers while the output variables are the distribution channels. The three suppliers should conveniently access the warehouse hence critical to consider the cost of transportation to the warehouse (Brandenburg, Govindan, Sarkis, & Seuring, 2014). The delivery to the distribution channels should be done at a minimal cost and also ensure timely convenience for all the outlets (Hugos, 2011). Apparently, the warehouse will be within proximity to two of the largest outlets whereby delivery to the small stores can be directed through the large shops. The warehouse thus directly serve the two large and three medium shops while partially delivering to the five small shops.

Step 3: Analyzing the Sensitivities

At this stage, the blueprint of the network plan is tested against the objectives of the logistic and supply chain management plan. The analysis of sensitivities incorporates the replication of the output of the logistic network plan whereby the primary target is to reach out to all the large, medium and small outlets (Mula et al., 2010). The delivery channels from the warehouse involve a direct connection to the large and medium outlets whereas the delivery to small stores through the large shops.

Step 4: Scenario Creation

The scenario creation stage involves the subject the network model to different possible scenarios that would subsequently impact the functionality of the logistic network plan (Stadtler, 2015). Additionally, the scenario creation facilitates the provision of enhancement for the operationability of the logistic network plan. The scenario for consideration for this logistic plan includes the withdrawal of either of the suppliers, the increase in demand for all levels of the distribution outlets and also the occurrence of both scenarios simultaneously. The scenario creation stage also establishes the credibility of the logistic plan and rendering enhancement for the network scheme (Hugos, 2011).

Step 5: Evaluation of Alternatives

The subjection to possible scenarios that would influence the proposed functionality of the network model gives rise to significant options that would deliver optimal results for the logistic network plan (Stadtler, 2015). The considerable option for the project includes the channeling of deliveries to the small outlets through large and medium shops. The alternative will ensure that an increase in demand for the stores and withdrawal or reduction of supply to the warehouse will be well handled. 

Step 6: Detail and Do (Implementation)

The final stage involves the implementation of the logistic network plan into an operational project. The implementation stage ensures that the underlying planning and the plot of the blueprint are put into an operational project (Stadtler, 2015). The network established the supply routes, the location of the warehouse and the distribution route to the shopping outlets. The logistic network plan is implemented once it is authenticated and validated to operate optimally. The implementation stage finalizes the logistic planning process and wraps up the project for future appraisals.

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  1. Brandenburg, M., Govindan, K., Sarkis, J., & Seuring, S. (2014). Quantitative models for sustainable supply chain management: Developments and directions. European Journal of Operational Research, 233(2), 299-312.
  2. Hugos, M. H. (2011). Essentials of supply chain management (Vol. 62). John Wiley & Sons.
  3. Melo, M. T., Nickel, S., & Saldanha-Da-Gama, F. (2009). Facility location and supply chain management–A review. European journal of operational research, 196(2), 401-412.
  4. Mula, J., Peidro, D., Díaz-Madroñero, M., & Vicens, E. (2010). Mathematical programming models for supply chain production and transport planning. European Journal of Operational Research, 204(3), 377-390.
  5. Stadtler, H. (2015). Supply chain management: An overview. In Supply chain management and advanced planning (pp. 3-28). Springer Berlin Heidelberg.
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