physical-distribution.ppt distributiin mark
- 2. Logistics & Supply Chain Logistics Component parts & Raw material In-process inventory Finished goods Supply Chain
- 3. Physical Distribution • Creation of customer is task of mktg. • Product availability leads to satisfaction • To achieve this value adding generally have a distribution activity known as distribution system, traffic mgt., mktg. logistics, or physical distribution • So it is a mktg. activity that concerns the handling & movement of goods
- 4. Physical Distribution • It includes all those activities concerned with the efficient movement of goods from the place of production to the place of consumption • It involves the handling of raw material fabricates parts, supplies & finished goods from producers to consumers via intermediaries
- 5. Physical Distribution • William Stanton: Involves the mgt.of physical flow of products & establishments & operation of flow systems • Philip Kotler: Involves planning, implementing, & controlling the physical flow of material & final goods from the point of origin of use to meet customer need at a profit
- 6. Objective of Physical Distribution • Basically two broad objective • 1. Attain customer satisfaction • 2. Profit maximization • 3. Getting the right product, at the right place, at the right time, in right quantity, at the right customer at the lower cost • 4. Proper co-ordination of distribution acivities
- 7. Objective of Physical Distribution • 5. To use powerful tool of competitive mktg. • 6. To provide better service of lower prices • 7. To increase profit margin
- 8. Objective of Physical Distribution – Meetings standards of customer service for • Timeliness of order fulfillment • Accuracy of order fulfillment – Reducing total distribution costs • Inventory levels against warehousing costs • Materials costs versus transportation costs • Distribution costs against customer service standards • Overall goal is to achieve the lowest total distribution cost compatible with the firm’s customer service objectives. – Reducing cycle (process completion) time • Faster processes for increased customer service
- 9. Significance of Physical Distribution • Creation if utilities: Place – Transportation Time – Warehousing ● Improved consumer service ● Cut in distribution cost ● Market share ● Price stabilization ● Play vital role where production location & markets are distanced
- 10. Cost of Physical Distribution Functions
- 11. Participants in physical distribution • Supplier • Manufacturer • Intermediaries Wholesalers, Retailers • Agents – Selling, Manufacturing, C & F etc.
- 12. Component functions of physical distribution • Planning the overall physical distribution system • In bound transport • Receiving – Raw material, orders • In plant warehousing • Inventory management • Order processing
- 13. Component functions of physical distribution • Packaging • Dispatch of goods • Out bound transport • Field warehousing • Customer service
- 14. Components of physical distribution • Order Processing – The receipt and transmission of sales order information • Order entry • Order handling • Order delivery – Electronic data interchange • A computerized means of integrating order processing with production, inventory, accounting, and transportation
- 15. Order processing • Series of logical steps from receiving orders to dispatch – there should be a standard procedure for receiving the orders, handling orders, granting of credit, invoicing, dispatching, collecting the bills and post dispatch adjustments
- 16. Steps in order processing • Communication of orders – Verbal or written • Credit check • Inventory check • Order of dispatch • Intimation to customer • Dispatch of goods • Collection of payments
- 18. Material Handling • Sub system of PDS • Stands for movement & handling of goods • Represents product handling from plant to warehouse & warehouse to place of loading • An agent of cost reduction & improved customer service • Reflects on efficiency & speed of warehousing operations • Efficient & effective MHS contributes efficiency & effectiveness of total PDS
- 19. MH operations performed in following stages • Unloading incoming material from transport vehicles • Moving unloaded material to assigned warehouses • Lifting the mat. from warehouses during order picking • Moving the material for inspection & packing • Loading packages/boxes to transport vehicles
- 20. MH Equipments & Systems • Manual – Use of man power & animal • Mechanised system – wheeled trolleys, forklift trucks, side loaders, mobile cranes, conveyors – wheel, roller, belt, chain • Semiautomatic system – sorting device robotics
- 21. Warehousing
- 23. Warehousing • An act of storing and assorting the finished goods so as to create maximum time utility at minimum cost • Sub function – Storage, movement, assorting, hold, consolidation, break bulk, packing,
- 24. Advantage of Warehousing • Serves as safeguard • Make provision for unloading • Serves economically at lower prices • Helps in determining the channel of distribution • Assist in maintaining continuous sales • Balancing demand & supply • Stabilizing prices • Reduces need for instant transportation