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Warehouse Planning and Capacity Optimisation

Warehouse Planning and Capacity Optimisation

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Published by Srikant Rajan
Simulates cost implication on different warehouse locations and suggests an optimal location and routing plan.
Simulates cost implication on different warehouse locations and suggests an optimal location and routing plan.

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Published by: Srikant Rajan on Jun 27, 2010
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03/22/2013

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ordering cost holding cost

Man 10000 0.75
Ret 12500 1
Week Qty demanded -retaile qty manufacture
21.7 1 !000 5000
11"2#.#2 2 2"000 "0000
" "2000 10000
1!5#5.#5 # 1"000 10000
$1.27 5 10000 000
2"000 "0000
7 "!000 #0000
! 1!000 15000
$ 12000 1000
10 2!000 20000
11 #2000 "0000
12 1"000
shortage cost ca%&man&'eek
2 Man in(
2.5 ret in(
lead time
retailer order retailer shortage retailer hold
17000 0 2000
11000 #000
2000 0 5000
15000 0 7000
5000 0 2000
1#000 7000 0
#0000 !000 0
20000 0 2000
10000 0 0
2000 0 0
20000 22000 0
50000
15000
10000
1
Mnaufacture shortage Mnu hold
2000 0
0 "#000
0 1!000
0 1"000
0 1#000
0 0
10000 0
0 "5000
0 2000
0 0
0 0
)lant ------* W+ -------* Market
,e- ,.-
/e /0 of locating W+ at site ,e- 1rans% cost
2mall 3arge
0a%acity "00000 00000
/0 "00000 500000
2#0 1"5
Decision var ye=1 if WH is located at e, 0 otherwise
2mall W+
4hmeda5ad 3udhiana 6ndore 3uckno' 7i.aya'ada 8hu5anes'ar
ye 0 0 1 0 1 0
9istance 0 $50 "$5 $$0 1155 1"!0
:nits trans% 1211#" 20!"7 2""70 " 2.!;<05 "1"02$
:nits = 5in 0 0 2""70 0 2!#"# 0
>o of trucks 0 0 1$ 0 2" 0
Which WH supplies which market
2mall
4hmeda5ad 3udhiana 6ndore 3uckno' 7i.aya'ada 8hu5anes'ar
8angalore 0 0 0 0 0 0
0hennai 0 0 1 0 1 0
9elhi 0 0 0 0 0 0
?ai%ur 0 0 1 0 1 0
Mohali 0 0 1 0 0 0
Mum5ai 0 0 1 0 1 0
+ydera5ad 0 0 0 0 0 0
@olkata 0 0 1 0 1 0
Decision var, which WH supplies how many to each market
2mall
4hmeda5ad 3udhiana 6ndore 3uckno' 7i.aya'ada 8hu5anes'ar
8angalore 0 1$5115 0 125 0.00;<00 "05!0
0hennai #" 0 10#!" 2117"5 51"2! "5#$7
9elhi 0 10"!0 0 2$0 0 #5#
?ai%ur 0 0 115# "011 !251# 1!255
Mohali 1$!2"0 0 105072 0 0 "#55"
Mum5ai 0 0 1$5" 0 77## 72$#
+ydera5ad 0 0 0 1$71 0 5#"#5
@olkata 1511! 0 #00$ #" !#!#7 1#2700
W+ to mkt 0 0 2""75! 0 2!#"" 0
Distance matrix
2mall
4hmeda5ad 3udhiana 6ndore 3uckno' 7i.aya'ada 8hu5anes'ar
8angalore 125 2005 1100 15!0 515 11#0
0hennai 1#10 20"5 1170 15"5 "$0 $50
9elhi 7$0 2!5 0 #"0 1"$0 12"0
?ai%ur 525 #50 #75 5!0 12$0 120
Mohali $#5 "0 !$0 #0 150 1#75
Mum5ai 5#5 1705 5$5 1"5 $!0 1510
+ydera5ad !!5 1520 "5 10$5 2$5 !10
@olkata 1#0 1525 1250 !5 1025 #00
1otal /0 100000
1rans% cost 27$7500
1otal cost #"$7500 0.#
2mall
4hmeda5ad 3udhiana 6ndore 3uckno' 7i.aya'ada 8hu5anes'ar
8angalore 0 0 0 0 0 0
0hennai 0 0 10#!" 0 51"2! 0
9elhi 0 0 0 0 0 0
?ai%ur 0 0 115# 0 !251# 0
Mohali 0 0 105072 0 0 0
Mum5ai 0 0 1$5" 0 77## 0
+ydera5ad 0 0 0 0 0 0
@olkata 0 0 #00$ 0 !#!#7 0
>o of trucks needed 2mall
4hmeda5ad 3udhiana 6ndore 3uckno' 7i.aya'ada 8hu5anes'ar
8angalore 0 0 0 0 0 0
0hennai 0 0 1 0 5 0
9elhi 0 0 0 0 0 0
?ai%ur 0 0 2 0 7 0
Mohali 0 0 $ 0 0 0
Mum5ai 0 0 5 0 0
+ydera5ad 0 0 0 0 0 0
@olkata 0 0 # 0 7 0
1 5oA 50.erseys
6 5oA 20kg
1 truck 5tons 5000 kg or
0ost of freight 15%er km %er truck 1 truck 2505oAes
1 truck 12500.erseys
1he 'arehouses ha(e a ca%acity of 1!00000 and are ca%a5le of satisfying till 2012. 4fter that one more W+ can 5e added as %er the requirements. 1he demand forecast 'ill also 5e more
accurate at a later %oint of time and this method is a 5it fleAi5le
2ince the distance is the most im%ortant factor in the trans% costB 'e could say that irres%ecti(e of the qty demanded at each marketB the W+ that ser(es a %articular market 'ould still 5e same
su5.ect to ca%acity 1he qty trans% and milk run solns 'ould only change for each year 'hich 'ill not affect W+ location decision
9istance sa(ed
10!0
$25
!0
100
2"0
1$!0
5$55 !$"25 0.0#
15%er km
$7"2 2007
2mall W+ 3arge W+
0oim5atore 4hmeda5ad 3udhiana 6ndore 3uckno' 7i.aya'ada 8hu5anes'ar
0 1 0 1 0 0 0
1#"5 0 $50 "$5 $$0 1155 1"!0
1"2$0 5$02! 0 57"$$" 0 0 0
0 5$02! 0 57"$$" 0 0 0
0 #! 0 # 0 0 0
2mall 3arge
0oim5atore 4hmeda5ad 3udhiana 6ndore 3uckno' 7i.aya'ada 8hu5anes'ar
0 1 0 1 0 0 0
0 1 0 1 0 0 0
0 1 0 1 0 0 0
0 0 0 1 0 0 0
0 1 0 1 0 0 0
0 1 0 1 0 0 0
0 0 0 1 0 0 0
0 0 0 1 0 0 0
2mall 3arge
0oim5atore 4hmeda5ad 3udhiana 6ndore 3uckno' 7i.aya'ada 8hu5anes'ar
0 ""2!0 200$55 $720 125$ 1$ $!
7$10 22""5$ 200# 5"25 2117"# 15## 2#52
"#52#! 1$057 25# 1### 2$5$ 25#$# 1"1"
0 0 1#00 #"715 "01# 2#00## 1"12"
50#0 1"05" 0 1$$ 157$ 2!0# 1"1
"#5"5 $!2# 255 ##2"! 252$ 21"# 1"1""
$#$5 0 2#70 1"51$0 1$7# 1##$ 1"11#5
5$0" 0 2#75 "#"5! 25$ 217$ #22
0 5!7!" 0 57"$!! 0 0 0
2mall 3arge
0oim5atore 4hmeda5ad 3udhiana 6ndore 3uckno' 7i.aya'ada 8hu5anes'ar
2"0 125 2005 1100 15!0 515 11#0
#25 1#10 20"5 1170 15"5 "$0 $50
1$55 7$0 2!5 0 #"0 1"$0 12"0
17!0 525 #50 #75 5!0 12$0 120
21$5 $#5 "0 !$0 #0 150 1#75
125 5#5 1705 5$5 1"5 $!0 1510
720 !!5 1520 "5 10$5 2$5 !10
17#0 1#0 1525 1250 !5 1025 #00
2mall 3arge
0oim5atore 4hmeda5ad 3udhiana 6ndore 3uckno' 7i.aya'ada 8hu5anes'ar
0 ""2!0 0 $720 0 0 0
0 22""5$ 0 5"25 0 0 0
0 1$057 0 1### 0 0 0
0 0 0 #"715 0 0 0
0 1"05" 0 1$$ 0 0 0
0 $!2# 0 ##2"! 0 0 0
0 0 0 1"51$0 0 0 0
0 0 0 "#"5! 0 0 0
>o of trucks needed 2mall >o of trucks needed 3arge
0oim5atore 4hmeda5ad 3udhiana 6ndore 3uckno' 7i.aya'ada 8hu5anes'ar
0 " 0 ! 0 0 0
0 1! 0 5 0 0 0
0 1 0 12 0 0 0
0 0 0 # 0 0 0
0 11 0 2 0 0 0
0 1 0 # 0 0 0
0 0 0 11 0 0 0
0 0 0 " 0 0 0
1he 'arehouses ha(e a ca%acity of 1!00000 and are ca%a5le of satisfying till 2012. 4fter that one more W+ can 5e added as %er the requirements. 1he demand forecast 'ill also 5e more
1his also makes sure that 'e are o%en to any ne' 6)3 teams in the future
2ince the distance is the most im%ortant factor in the trans% costB 'e could say that irres%ecti(e of the qty demanded at each marketB the W+ that ser(es a %articular market 'ould still 5e same
1he qty trans% and milk run solns 'ould only change for each year 'hich 'ill not affect W+ location decision
3arge W+ sum of units 9emand 0a%acity a(
0oim5atore 1!00000
0
1#"5
120$!$ 0
0 1!##55 1210000
0
0."$ #7##55
3arge
0oim5atore
0
0
0
0
0
0
0
0
3arge
0oim5atore 2um 9emand
1# 1"0000 1"0000
1#$!5$ ""!7$5 155000
""!$ ""710" 172000
"21# 1#2"!" 1#2000
"2$ 255""1 1#"000
2$$ 1!"75$ 175000
11215# 1"51$0 1"#000
"175 15$"01 15$000
0 1!1!2 1210000
3arge
0oim5atore
2"0
#25
1$55
17!0
21$5
125
720
17#0
3arge
0oim5atore 2um 9emand
0 1"0000 1"0000
0 ""!7$5 155000
0 ""710" 172000
0 1#2"!" 1#2000
0 255""1 1#"000
0 1!"75$ 175000
0 1"51$0 1"#000
0 15$"01 15$000
>o of trucks needed 3arge
0oim5atore
0
0
0
0
0
0
0
0
1he 'arehouses ha(e a ca%acity of 1!00000 and are ca%a5le of satisfying till 2012. 4fter that one more W+ can 5e added as %er the requirements. 1he demand forecast 'ill also 5e more
2ince the distance is the most im%ortant factor in the trans% costB 'e could say that irres%ecti(e of the qty demanded at each marketB the W+ that ser(es a %articular market 'ould still 5e same

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