MILK RUN SYSTEM FOR INBOUND LOGISTICS

Abstract

The Project entitled “Milk Run System for Inbound Logistics” is concerned with the use of transportation strategies in different supply chains. Transportation which is part of logistics has an important role to reduce the total cost of procuring the raw material and thereby the cost of production. Various cases based on Spoke system (each vendor supplies directly to the buyer) and Rim system (one vehicle collecting material from more than one vendor) have been analyzed in which order size, no. of vendors in a group and their route sequence has been considered. The cost parameters which are affected by these decisions are cost of transportation and cost of carrying inventory. In this project following two approaches have been worked out to minimize the total cost (total of transportation and cost of carrying inventory) 1. Effect of different ordered quantities on logistics cost (total of transportation and inventory cost) has been analyzed on Rim and Spoke system. 2. Different...