Lecture Basic Marketing: A global managerial approach - Chapter 12: Logistics and distribution

Chapter 12:
  

Logistics and
Distribution

For use only with Shapiro, Wong, Perreault, and McCarthy text
Copyright © 2002 McGraw-Hill Ryerson Limited


Understanding Physical Distribution
Total Cost
of PD

Costs ($)

Inventory
Cost
Lost Sales

Transporting
Cost

0
0

90%

Customer Service Level
Exhibit 12­1
12­2

For use only with Shapiro, Wong, Perreault, and McCarthy text
Copyright © 2002 McGraw-Hill Ryerson Limited


Coordinating Logistics Activities

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12­3

Sharing and Shifting

Reducing Conflict

JIT

Chain of Supply
Better Information-EDI
and Internet

For use only with Shapiro, Wong, Perreault, and McCarthy text
Copyright © 2002 McGraw-Hill Ryerson Limited


The Transporting Function

Rail

Truck

Modes
of
Transportation

Air
Pipeline

12­4

Water

For use only with Shapiro, Wong, Perreault, and McCarthy text
Copyright © 2002 McGraw-Hill Ryerson Limited


The Storing Function
Price Stability

Flexibility

Costs

Specialized Function
12­5

For use only with Shapiro, Wong, Perreault, and McCarthy text

Copyright © 2002 McGraw-Hill Ryerson Limited


Comparing Private and Public Warehouses
Type of warehouse

Characteristics

Public

Private
Fixed Investment

Very high

No fixed investment

High if volume is low
Very low if volume is
very high

Low

High

Low managerial control

Adequacy

Highly adequate

May not be convenient

Flexibility

Low

High

Unit Cost
Control

Exhibit 12­6
12­6

For use only with Shapiro, Wong, Perreault, and McCarthy text
Copyright © 2002 McGraw-Hill Ryerson Limited