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31 Cards in this Set
- Front
- Back
MRO |
Maintenance, repair, and operating supplies. items used in general operations and maintenance. like spare parts. |
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Purchasing Activities |
see 8-10 for a diagram of the flow of activites and how each is categorized. |
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Purchasing must establish specifications based on |
1. quantity 2. cost 3. function- use and quality level needed |
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3 general ways to source goods |
1. sole sourcing-goods provided by one supplier. likely bc they are the only ones. 2. multiple sourcing- provided my multiple suppliers. reduces the risk. 3. single sourcing- provided by one supplier but there are other options available. this is to focus on long term relationship |
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Supplier partnering |
- might happen in sole or single sourcing. the 3 key factors in partnering: 1. long-term commitment 2. trust 3. shared vision |
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Consignment |
a type of partnering. the supplier physically gives the product to the customer for use and the supplier retains ownership of the product until used. |
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VMI |
a type of partnering. the buyer owns the goods and the visibility of the buyers forecasts are shared with the supplier |
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Categories covered in a contract |
1. price 2. terms 3. delivery 4. quality 5. quantity |
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Purchases may be generated by the following techniques |
1. conventional (Non-MRP) Requisitions- found in ETO and low volume MTO production environments- where requirements are unique. 2. MRP planned order releases- release of planned orders 3. Kanban signals- the signal goes to the supplier. no requisitions or POs issued. contractual relationship needed. 4. buffer replenishment |
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The purchasing cycle |
1. general requistions issued 2. Issue POs- review req and select supplier 3. follow up- the PO is tracked to make sure due dates will be met 4. receive goods 5. approve payment |
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Supplier Scheduling |
a more progressive contract buying that requires due dates to a supply partner for inclusion in its master scheduling process. not in the scope of this course. |
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One type of system to monitor supplier performance and provide feedback... |
balanced score card! |
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Physical distribution |
movement of goods from suppliers to their customers through distribution channels. It adds value in two ways: 1. place value- locates good where they are available to customers. 2. time value- makes goods available when customers want them |
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Physical Distribution activities |
see 8-37 for a list if it is relevant. |
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Business-Level objectives of distribution inventory Management |
*if a company uses distribution centers 1. provide required levels of customer service 2. minimize the cost of transportation and handling 3. minimize inventory cost 4. interact with the factory to minimize scheduling problems. |
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3 systems used to control distribution inventory |
1. pull (decentralized) system 2. push (centralized) system 3. DRP |
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Pull inventory system |
distribution centers order what they need from a central center when required, without regards to other distribution centers, available inventory, production schedules at the factory. demand at distribution center might be stable but it orders from central supply once order point is reached and this creates lumpy demand and facotry might not have enough lead time to meet demand from all Distr. centers. |
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Push Inventory System |
all forecasting and order decisions are made centrally using visibility of whats happening at the other centers. this improves coordination among factory, central supply and distribution center, but does not fully respond to local demand |
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DRP |
Distribution Requirements Planning. this involved collaborating between the distribution center, central supply, and the factory. visual of logic is on pag 8-44. the logic uses time-phased netting rather than order point system. in the end, the distribution center sends order releases to the central supply and all orders are added to the factorys master schedule |
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objectives of transportation |
1. provide high levels of customer service 2. keep in transit time and inventory to a minimum 3. minimize transportation costs |
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TL and LTL |
Truck Load. and less than truckload. Practice besiding between using a distribution center or not pg 8-53 |
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reverse logistics |
a complete supply chain dedicated to the reverse flow of products and materials for the purpose of returns, repair, remanufacture, and/or recycling |
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Two categories of reverse logistics |
1. asset recovery- return of actual products. 2. green logistics- the responsibility of the supplier to dispose of packaging or environmentally sensitive materials. |
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5 basic modes of transportation |
1. rail- best for: large loads over long distance. cheaper than road for large and bulky 2. road- low capital compared to rail. door to door service. Best: small goods in dispersed market 3. air- high cost. suitable for high-value, low weight and emergency items 4. water- low operating costs per ton-mile. slow. most useful: moving low-value, bulky, long distance where route is available. 5. pipeline- low operating costs. impervious to weather. useful for large, constant volumes. |
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two types of carriers |
1. for hire- common (for the public) or contract (hauls for specific customers under contract) 2. private- companies own and lease their own equipment to carry goods. |
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Decision factors for selecting carrier |
pg 8-63 |
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categories of shipping costs |
1. line haul costs- fuel, wages etc. depend on distance not weight. 2. pickup and delivery costs 3. terminal handling costs 4. billing and collecting costs |
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how to reduce transportation costs |
1. increase weight shipped to reduce line haul cost 2. consolidate shipments to reduce ... costs. |
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carrier rate cost structure types |
1. based on full truck load
2. based on less than full load. rates depend on commodity shipped, and the weight and distance. these factors might be considered: value, density, perishibility, packaging |
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Warehousing |
PG 8-71 decribes different processes and activities. |
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stock location systems |
1. fixed location- assign an item to a permanement location in warehouse 2. floating (random) location- assign space wherever it is appropriate. advantage is cube utilization. |