Supply Chain Strategy, Inventory & Distribution Planning.

Explore the key logistics drivers—facilities, transportation, inventory, pricing, and information systems—and see how outsourcing, fleet decisions, price strategies, and ERP evolution shape supply chains.

Explore how strategy and tactics create a strategic fit in the supply chain, contrasting efficient and responsive models with Walmart and 7-Eleven as sourcing, inventory, and transportation examples.

Explore supply chain facilities—from storage and raw material warehouses to finished goods, assembly, distribution, and fulfillment centers—and learn KPIs such as capacity, utilization, cycle time, and service level.

Explain how inventory buffers supply-demand mismatch and delivery variability, and distinguish cycle inventory from seasonal inventory with practical metrics like fill rate and inventory turns.

Assess means of transportation and transport nodes in the supply chain, from ships and rail to trucks and airfreight. Compare inbound versus outbound flows, and cost-based versus performance-based metrics.

Analyze how information flows through ERP systems and collaboration tools to enable pull-based supply chains, forecasting, planning, and budgeting to decide what, when, and how much to send or produce.

Explore sourcing as the procurement function driving up to 70 percent of cost of goods sold, emphasizing outsourcing and supplier metrics like quality, on-time delivery, shrinkage, and payable outstanding.

Explore value-based pricing and cost-based pricing, where price reflects perceived value or cost plus margin, and analyze key metrics like average selling price and average order size.

Explore how logistics drivers shape inventory outcomes with metrics like flow time, fill rate, cycle service level, throughput, pricing, and facilities metrics, including information systems with ERP or RPA consulting.

Explain distribution strategies across the downstream supply chain, from direct delivery to customers to in-transit hubs and click and collect models.

Explore distribution networks and strategies for finished products, showing no one size fits all approaches, balancing direct delivery to large retailers with distributor channels for smaller markets.

Explore how distribution decisions shape goals and drivers such as response time, product variety, availability, customer experience, time to market, and returns, while balancing facilities and inventory costs.

Explain how increasing facilities reduces transport costs up to a point but raises inventory and facility costs, creating a non-linear logistics cost curve and better response time.

Explore manufacturing storage and direct shipping (drop shipping), using postponement to keep inventory at the manufacturer, reducing inventory costs while facing higher transport costs and slower response times.

Aggregate items from manufacturing into an in-transit hub to merge inbound shipments for one final delivery. This lowers transportation costs, reduces on-hand inventory, and enables postponement and multiple item orders.

Push products to distributors to leverage forecasted demand, achieving economies of scale with truckloads, and have distributors deliver orders near customers for faster delivery, lower transportation cost, and improved experience.

Distributor storage with last mile delivery shifts delivery to the distributor, requires investment in delivery systems and an order management system, and offers near-customer service with higher costs.

Cross docking with customer pickup consolidates orders at a central dock to serve multiple pickup sites, lowering transport costs and boosting response time; ideal for fast-moving items with postponement.

Explore how click-and-collect and omnichannel strategies enable in-store pickup of online orders, with a materials flow from suppliers to retail stores and separate information flow through the website.

Retail storage and customer pickup offer fast response and low transport costs near customers, but raise inventory costs and limit variety; direct shipping adds variety with slower visibility.

Balance cost and service by choosing stock locations based on demand: store for high-demand items, supplier for low-demand, and retail storage for medium demand, with security and fast delivery considerations.

Design distribution strategies by evaluating product characteristics, demand, cost, budget, and capital investment; place high-demand items near customers and low-demand items near manufacturing, and keep high-value products near manufacturing storage.

Explore how choosing transportation modes—trucks, DHL, rail—affects logistics costs and inventory, illustrating the trade-off between transportation and inventory costs with Excel-based examples.

Learn how to balance inventory and transportation costs by selecting a distribution network through calculations and operational metrics, illustrated with Ikea’s low-cost sourcing, modular designs, and global logistics.

Identify the four transport stakeholders: shipper, carriers, owners, and regulators. Explain shipping payments, movement of goods, ownership of transport, and regulators guiding deregulation and market-based pricing.

Compare and contrast air transportation, package carriers, trucks, rail, and sea freight to optimize cost, speed, and capacity, including intermodal options and last-mile delivery.

Examine carrier strategies from direct shipment to a single destination, aggregation across buyers, and cross docking with milk runs to optimize transport costs, inventory, and service levels.

Evaluate direct supplier-to-store shipments versus milk-run routing through multiple suppliers for a multi-store retailer, using q/2 average inventory and inventory cost data.

compare direct shipping and a multi-supplier to-store strategy by computing shipments, transportation costs, and average inventory under two demand levels (960000 and 120000).

Explore milk runs in Excel, compare two-stop deliveries against direct shipping, and assess how demand shifts cost, with an assignment to simulate four suppliers.

Compare high-demand chocolate with low-demand milk runs in distribution planning across stores. Using more shipments from more suppliers lowers inventory costs but raises transportation costs.

Evaluate freight forwarding and carrier offers to select the cost-minimizing transport policy for motor shipments, factoring in in-transit and safety stock costs, lead time, and thresholds.

Calculate total annual transportation and inventory costs for rail and trucking options by determining lot size, price per pound, transport costs, safety stock, and in-transit inventory.

Analyze how inventory levels, safety stock, and in-transit inventory affect total cost. Compare trucking and rail transport to identify the most cost-efficient option.

Analyze several scenarios by evaluating transportation costs, total demand, average inventory, in-transit inventory, and lead times to identify the most cost-effective option.

Master inventory under uncertainty and EOQ trade-offs between transportation, ordering, and holding costs. Analyze min-max, order-up-to, periodic review, fill rate, cycle stock, service levels, and aggregation.

Analyze how demand uncertainty and transportation affect inventory decisions, comparing continuous reorder point and periodic review policies, and assessing safety stock, lead time, and average inventory.

Learn to compute fill rate and service level under uncertain demand using normal distribution assumptions, reorder points, and safety stock. Use Excel formulas to estimate lead-time demand probabilities and shortages.

Analyze a bicycle supplier's inventory policy, computing average inventory from cycle and safety stock with fixed lot sizes, and evaluate flow time, service level, and reorder points using fill-rate targets.

Compute average inventory, cycle stock, safety stock, and flow time for a two-week demand lead time with reorder point, achieving a 92% cycle service level.

Compute the expected stockouts and item fill rate from reorder point and safety stock using standard normal distribution and sigma. Assess cycle service level to evaluate policy.

Learn how to set cycle service level targets and compute safety stock and reorder points using probability and standard deviation to meet 90 to 98 percent service levels.

Define the service level, calculate safety stock and reorder point, and adjust safety stock to achieve the target fill rate using the expected shortage calculation.

Aggregate safety stock by centralizing in a warehouse to reduce total safety stock via the square root of stores, when store demands are independent; plan for dependence scenarios.

Analyze a practical safety inventory aggregation scenario for two TV products and compare central warehouse versus store-level stocking across 2,000 stores. Highlight the economic benefits and holding cost implications.

Analyze how coefficient of variation and demand shape centralized versus store‑level inventory in a supply chain scenario. Compute safety stock, holding costs, and the impact of aggregating inventory across stores.

Explore aggregation effects on safety stock in centralized warehouses, showing reduced variability, cost savings in holding inventory, and cash flow gains from strategy scenarios.

Analyze the time.it medical equipment case across 24 territories, optimizing inventory and transportation with periodic replenishment from Madison and three options—hubs, weekly orders, or direct shipping.

Compare three inventory policies for local versus centralized distribution, calculating lot size, cycle stock, and safety stock using review periods, lead times, and aggregation to compare service levels.

Compare the continuous (Q) and periodic inventory policies, and explain safety stock, service level, and the average and maximum inventory under the S-max order-up-to approach per location.

Analyze inventory costs for high and low value items by using a max stock policy with weekly replenishment, showing cost savings from consolidation and reduced safety stock.

Evaluate transportation and inventory costs to compare shipment strategies; centralizing inventory with door-to-door FedEx minimizes total cost, balancing economies of scale against delivery speed and demand certainty.

Examine temporal aggregation in transportation and its impact on cost, delivery options, and response time. Identify a sweet spot where savings plateau as variability declines with longer aggregation.

Tailor transportation setups to density, distance, and product value by using milk runs for nearby demand and cross docking for longer trips, while aggregating or desegregating inventory to reduce costs.

Explore centralized versus multi-location inventory, ordering frequency, cycle service level, and safety stock to optimize fill rate, holding costs, and customer satisfaction while setting the stage for distribution planning.

Explore distribution requirement planning to optimize a central and regional warehouse network with retailers, using bottom-up or top-down forecasting to plan weeks to months ahead.

DRP enables inventory optimization through information sharing across entire supply chain in a vertical structure from central to regional warehouses and retailers, guided by forecasts and EOQ-based fixed order quantities.

This lecture demonstrates calculating lot size with a square-root formula using demand, ordering cost, and holding cost, and determining safety stock from demand variability to inform a DRP plan.

Apply distribution resource planning to compute forecast, safety stock, and gross requirements for a retailer, and determine inventory, planned receipts, net requirements, and order releases.

Apply distribution requirements planning to compute retailer DRP values, safety stock, beginning and ending inventories, and ordering quantities across retailers, using a consistent formula and adjusted demand.

Plan regional warehouse one to support six retailers, considering origin-to-central three-week lead time and regional two-week lead time. Maintain 85% safety stock with a central replenishment cycle of one week.

Analyze the regional warehouse drp by balancing retailer demand, zero-demand periods, and safety stock of 91, while ordering three weeks ahead to align upstream supply with today’s demand.

Calculate warehouse demand and release planning across nine weeks, adjusting for safety stock and standard deviation. Analyze drp costs including ordering and holding costs to determine total supply chain cost.

Conclude the fixed quantity drp by calculating annual total ordering, holding, and overall costs across retailers, accounting for safety stock, and set up the next lecture on alternative order quantities.

Drp with periodic order quantity consolidates orders using forecast and safety stock to plan three orders in ten weeks, often lowering total cost versus fixed order quantity through transportation consolidation.

Drp with chase strategy applies a lot-for-lot policy to keep safety stock minimal, making receipts equal to demand and reducing inventory cost, though ordering and truck costs shape total cost.

Explore optimization of inventory across central and regional warehouses and retailers using binary variables and linear programming to minimize total cost, including ordering, holding, and safety stock constraints.

Analyze retailer no. 5 optimization under inventory constraints. Demonstrate how ending inventory must meet safety stock, apply binary decisions and fixed-cost constraints to minimize total cost.

Demonstrate sequential optimization across retailers and warehouses, showing safety stock impacts, starting times, and rising total costs; reveal that lot-for-lot is cheaper and propose simultaneous optimization to lower total cost.

Demonstrates simultaneous optimization across central and regional warehouses to minimize cost, comparing with sequential optimization, using a linear programming model with binary decisions and fixed safety stock across three echelons.

Compare drp strategies, including fixed quantity and periodic policies, and examine how transport, ordering, and inventory costs interact with safety stock and cycle stock.

Deliver a final recap on distribution requirements planning concepts, including chase, periodic and fixed order quantity DRP, and sequential versus global optimization within supply chain strategy and inventory planning.