Capacity Utilization Review on Outward Freight

IDEA adds tremendous value to study capacity utilization on outward freight operations.

 

Let us say an entity deals in 'Product A' which is delivered to its 'Stockist B' through 'Carrier C' on 'Route D' where the freighter has a carrying capacity of say '12 Metric Tons'.

 

Ideally if the entity needs to send 5 batches of 2 Metric Tons (10 Metric Tons in Total) each they should plan/rationalize the outward freight through a single freighter having a carrying capacity of 12 Metric Tons. 

 

What may happen is the entity may dispatch 'Product A' to 'Stockist B' through 'Carrier C' on 'Route D' using multiple freighters of 12 Metric Tons each. This is a colossal waste of outward freight and inflates the outward freight cost substantially. Much of this happens as the activity is done on an adhoc basis without systematic outward freight movement planning by the Logistics Team.

 

Using IDEA Software the following steps can be done to rationalize the outward freight activity -

 

a. Summarize the outward freight movements - Group On - Journey Date, Product, Stockist, Carrier, Route. Total On - Actual Metric Ton carried per trip by freighter. This summarization will provide the actual trip count per Date, Product, Stockist, Carrier and Route

 

b. Join the freighter carrying capacity in Metric Tons and Per Trip Cost to the summarization child database above on Product, Stockist, Carrier and Route

 

c. Append a virtual numeric field titled 'Optimum Trip Count' to the joined child database with the criteria Actual Metric Ton Sum/Capacity in Metric Tons

 

d. Append a virtual numeric field titled 'Excess Trips' with the criteria Actual Trip Count - Optimum Trip Count

 

e. Append a virtual numeric field titled 'Cost of Excess Trips' with the criteria Excess Trips * Per Trip Cost

 

Kind Regards

 

Jairam