Question

Explain the flow of logistics for an FMCG manufacturer

Answer 1

Typically, Logistics is the process to deliver customer demanded product which produced in manufacturing unit using distribution network and depending on stock availability. It is linked and depending on Demand planning and Supply chain process activities.

Basically, logistics is divided into two types.

1. Inbound Logistics
2. Outbound Logistics

1. Inbound Logistics :

It also divided into three sections.

1A. Distribution Requirement planning : It control inventory at stock points. It decided how much stock to be produced and prioritised. It is also called as MRP i.e material requirement planning.

1B. Warehouse Management: It contains capacity planning which uses stock keeping methods for Racking configuration and warehouse layout. It also check loading and unloading capacity. It also check FIFO management and shipment/delivery execution process.

1C. Transportation Management: It checks transport providers and execute shipment/delivery. It manages transport route management and controls on distribution cost savings.

2. Outbound Logistics :

It also divided into four sections.

2A. Customer Service : Customer raises purchase order as per their requirement. Once PO is raised, then Production Order i.e replishment order is created to fulfill customer order for requested date and further different stock inventory levels are controlled.

2B. Order Fulfillment :As per customer Order, it is delivered, shipped using different distribution network and transportation routes management. Further, Billing process is done once POD i.e proof of delivery is completed by customer. Key performance Index (KPI) is tracked to improve service quality to customer. Here, onshelf quality and case fill distribution is analysed to improve customer service KPI standard.

2C. Warehouse Management : Shipment and delivery execution is completed. Here loading and unloading capacity configured and managed for dispatch and docking. Stock is also managed using FIFO process.

2D. Transportation Management: Once Stock transfer order process is completed, Shipment cost and Freight cost document is created for supplier/distributor to complete shipment and delivery execution process.