LSCM 3960 ch 11 Exam Rated A+

LSCM 3960 ch 11 Exam Rated A+ Organizations may benefit substantially from the establishment of one or several warehouses to reduce transportation costs. t/f - Answer- true 5. A common fulfillment strategy of many firms is to use the normal distribution network for most items including their low-velocity items. t/f - Answer- false One of the primary tradeoffs at the facility level is space versus equipment. t/f - Answer- true Efficiency of distribution facilities and networks is not nearly as critical as their speed. t/f - Answer- false Inventory handling, storage, and processing facilities help supply chains create time and place utility. t/f - Answer- true Sortation refers a type of conveyer equipment. t/f - Answer- false It is not difficult to find and train high-quality personnel for DC operations. t/f - Answer- false When establishing a distribution strategy, the first and most obvious consideration is the product. t/f - Answer- true Cross-docks typically increase transportation costs. t/f - Answer- false The drawback of centralized inventory is the long distance to customers, which typically extends lead times and results in higher transportation costs. t/f - Answer- true Contract warehousing is different than 3PL warehousing. t/f - Answer- false The first facility consideration is to determine the size of each operation within the network. t/f - Answer- true After the layout of the operations is determined, attention shifts to the facility size of the operations within the distribution operation. t/f - Answer- false Slotting is defined as the placement of product in a facility for the purpose of optimizing materials handling and space efficiency. t/f - Answer- true Product handling functions include both receiving and shipping. t/f - Answer- true KPIs cannot be used in connection with distribution center activities as they do not provide tangible, relevant data. t/f - Answer- false Order accuracy and order completeness are the same. t/f - Answer- false Asset utilization is very important in a 3PL warehouse. t/f - Answer- false WMS is more than a simple database that provides stock location information. t/f - Answer- true The roles of the distribution center include __________ - Answer- balancing supply and demand, protecting against uncertainty, and promoting transportation economies Distribution facilities can provide numerous services, depending on the requirements of the supply chain. Which of these is not a typical service? -assortment -accumulation -allocation -activity - Answer- activity One important interaction that must be considered is the tradeoff between distribution and ________ - Answer- transportation The primary tradeoffs and relationships between resources include the following - Answer- all the above -space vs. equipment -equipment vs. people -people vs. space Potential labor problems for distribution centers may be the result of - Answer- the graying of America Certain raw materials can be stored - Answer- outside A downside of direct shipping is - Answer- can create higher transportation charges. The drawback of centralized inventory is - Answer- that it extends lead times and results in higher transportation costs The key financial consideration in choosing between private and 3PL distribution options is - Answer- volume of product being moved The first facility consideration is to determine - Answer- the size of each operation within the network. The primary facility operations focus is - Answer- on the movement and storage of product. Which of these is not a support function? - Answer- movement and storage Asset utilization is a very important aspect of - Answer- private distribution facilities. Distribution operations help organizations overcome challenges, support other processes, and take advantage of economies of scale. Name and briefly discuss five roles that these operations play. - Answer- • Balancing supply and demand - Whether seasonal production must service year-round demand (e.g., corn) or year-round production is needed to meet seasonal demand (e.g. holiday wrapping paper), distribution facilities can stockpile inventory to buffer supply and demand. • Protecting against uncertainty - Distribution facilities can hold inventory for protection against forecast errors, supply disruptions, and demand spikes. • Allowing quantity purchase discounts - Suppliers often provide incentives to purchase product in larger quantities. Distribution facilities can hold the additional quantities until needed, reducing the purchase cost per unit. • Supporting production requirements - If a manufacturing operation can reduce costs via long production runs or if outputs need to age or ripen (e.g., wine, cheese, fruit), the output can be warehoused prior to distribution. • Promoting transportation economies - Fully utilizing container capacity and moving product in larger quantities is less expensive per unit than shipping "air" and moving small quantities at a time. Distribution facilities can be used to receive and hold the larger deliveries of inventory for future requirements. Discuss in detail the various tradeoffs that affect distribution operations - Answer- One important interaction that must be considered is the tradeoff between distribution and transportation operations. When a supply chain has no market-facing DCs or warehouses (product is sent directly from plants to individual customers), transportation costs will be very high. Organizations may benefit substantially from the establishment of one or several warehouses to reduce transportation costs. Large shipments can be transported over long distances from plants to distribution facilities via truckload carriers; then the smaller shipments are delivered to nearby customers. However, there comes a point where you build too many warehouses and total costs increase. Why is this so? With so many facilities, operating costs will increase and transportation expenses will rise (inbound shipments will become less-than-truckload shipments, which are more expensive than shipping full truckloads). Another key tradeoff must be made between distribution and inventory. Generally, the more DCs and warehouses, the higher the total inventory carrying costs will be. As facilities are added to a fulfillment system, the amount of inventory will increase in total, but at a decreasing rate. This move toward decentralized inventory inhibits the ability to adopt a risk pooling strategy as each facility must hold additional safety stock. The tradeoff between distribution operations and customer service is another important issue. More distribution facilities in the supply chain create better service for customers. Buyers are more comfortable if they know the supplier has a DC within a day's drive from their operations. Decision makers must balance the value of better service levels with the additional costs of operating facilities and carrying inventory. Tradeoffs must also be made at the facility level between the primary resources ava There are two options for product flow through the supply chain: direct shipments versus movement of goods through distribution facilities. Discuss advantages and disadvantages of both options. - Answer- Direct shipping operations bypass distribution facilities, fulfilling retail store requests from the primary production point (manufacturer's factory or warehouse) rather than interim distribution facilities that hold inventory. Similarly, Internet retailers directly distribute goods to the end consumer without the need for retail outlets. Direct shipping avoids the need to build and operate distribution facilities, reduces inventory in the system, and often compresses order cycle time. Direct shipping works particularly well when customers place orders for truckload quantities or when product perishability is an issue. On the downside, it is expensive to deliver small quantities to buyers (reduced transportation efficiencies), and there is limited safety stock readily available to protect against demand surges. Furthermore, many companies are not capable of fulfilling orders for case and individual unit quantities. Thus, it is important to consider product characteristics, demand volume and variability, and related issues before making the decision to establish a direct shipping strategy. Properly planned distribution facilities can address the shortcomings of direct shipping. These facilities, including traditional warehouses, DCs, and cross-docking facilities, provide the supply chain with additional capabilities. Warehouses and DCs can hold goods in anticipation of customer orders, provide a buffer of safety stock to protect against contingencies, and handle small quantity orders efficiently from transportation and fulfillment standpoints. Cross-docks can provide a high-velocity alternative to direct shipping at lower transportation cost with product mixing capabilities. Of course, it is necessary to analyze the inventory, transportation, and service tradeoffs before choosing between direct shipping and the us