Classic Problems of Logistics Case Analysis in Master of Logistics Examination (3)

Case 3: American Machinery Company is an enterprise mainly engaged in machinery manufacturing, aiming at meeting customers' needs for a long time. In order to ensure supply, the company has established more than 500 warehouses in the United States. But the cost of warehouse management has been high, about 20 million dollars a year. Therefore, the company hired a survey company to make a detailed survey report. The result shows that if 202 warehouses are reduced at present, the total warehouse management cost will be reduced by 2-3 million US dollars, but the sales revenue will be reduced by 65,438+08% due to possible supply shortage.

Excuse me:

1. If you are the president of an enterprise, will you reduce the number of warehouses according to the results of investigating the company? Why?

2. If you don't do this, how will you make a decision?

Key points of case 3 answer:

A:

1. No, because: (1) Reducing 202 warehouses can only save $2 million to $3 million, but it will cause 18% sales revenue to drop, which is not worth the loss. (2) Even if you can save a lot of money by reducing the loss of warehouse sales revenue, it is not the best policy, because it is equal to the loss of customers. In the modern marketing environment, the only way for enterprises to survive and develop is to meet the needs of users to the maximum extent.

2. Firstly, according to the principle of target market segmentation, the national market is divided into about 10 ~ 15 regions through investigation, with the aim of establishing regional distribution centers in each region; Secondly, the appropriate geographical location of distribution centers in each region is selected by the location method of distribution centers; Third, choose about 5 centralized sales cities in each region to build urban distribution centers; Finally, it is of positive significance for the distribution center to reduce logistics costs and improve customer satisfaction from four aspects: basic operation, practical logistics technology, logistics equipment and management information system.

Only in this way can we achieve the goal of reducing the number of warehouses and costs, and at the same time improve customer satisfaction through the operation of modern distribution centers, killing two birds with one stone.