Logistics Presentation

Samsonic case 2

WHO ARE WE?

Kim Ngan TranHaidong WangShan Shan HuNatusha GeermanChau Nguyen

TABLE OF CONTENT

IntroductionCurrent situationProposalRecomendation

MISSION

Business strategy: Product leadershipBusiness objective:

“Samsonic wants to provide its customers with innovative, trendy and technologically advanced products for

a reasonable price.”

OUR PRODUCTS

Innovative

Innovative

Functional

Functional

OUR PROBLEM

Green dots >85% on timeOrange dots 75%to 85% on timeRed dots <75 % on time

• Long distance from consolidation hub to WEDC

• Only urgent orders distributed by airfreight

Long lead time

• Only one warehouse• Wrong position of

warehouseLate delivery

• DCs are far awayIncomplete orders

• Customers compare with competitors’ delivery performance

Competitor

COMPLAINT AND BOTTLE NECK

P(Tablet)

S

P

C

C

WEDC

P

Airport Milan

Port Hamburg

Production site of local company (Norway)

Two shifts:06:00-15:00

Or15:00-24:00

Stock after production Hub (Asia)

Truck (Norway)Next day

Cross docking(1-3 days delivery)

Domestic Customers

International Customers

CURRENT SUPPLY CHAIN

CURRENT SUPPLY CHAIN RISK

Decrease

d prices o

f fuel

Quality

issues w

ith su

ppliers

Accidents

Rising l

abour w

ages

Natural

disaste

r

Increasi

ng tax

es0

50

100

150

200

250

300

VALUE DENSITYInterest costs

Transport & Storagecosts

Value Density in$/m3

Packing Density incarton/m3

100

1000

10.000

100.000

1 10 100

SEA AND AIR FREIGHT

Adapters

Washing machine

Tablet

Headsets

THE PROPOSAL!

SCENARIO 2SCENARIO 1

Adapters: Binh Duong, Vietnam

Tablets and Headsets: Maharashtra state India

Washing machines: Ploiesti, Romania

DC: Madrid, Spain London, England Hamburg, Germany Torina, Italy

Harbor ( Asia): Ho Chi Minh, Viet NamHarbor in Europe: Rotterdam, Netherlands.Airports in Asia: Mumbai, IndiaAirports in Europe: Amsterdam, Netherlands

SCENARIO 2SCENARIO 2 Tablets & headsets and adapters: Shenzhen, China

Washing machines: Wroclaw, Poland

DC: Barcelona, Spain London, England Lille, France

Harbor ( Asia): Shenzhen, ChinaHarbor in Europe: Valencia, Spain.Airports in Asia: Shenzhen, ChinaAirports in Europe: Barcelona, Spain

NEW SUPPLY CHAIN

S P

C

Washing machine & dryerTabletHeadsetsAdapters Planning order

Customers orderLess than 72 hours

Distribution center

PRODUCT CHARATERISTICTablet Headset Washing

machine & dryer

Adapter

Product life cycle

Short Short Long Long

Product variety

High High Low Low

Forecast accuracy

Low Low High High

Demand Unpredictable Unpredictable Predictable Predictable

TIME TO MARKET

Shorter lead timeControlled orders’ processRapid prototypingAccurate forecast of salesCustomer relationship management system

COST OF REDESIGNCosts Scenario 1 Scenario 2Transport Decrease DecreaseLabor Increase IncreaseManufacturing Decrease DecreaseInventories cost Decrease DecreaseCost of lost sales

Decrease Decrease

Relocate DC New cost New costNew warehouses

New cost New cost

Fixed cost Increase IncreaseTOTAL Decrease Decrease

MITIGRATION STRATEGY

Lille, France faces high risk of strikesNatural disasters in AsiaCopyright infringementQuality issues with suppliers

KEY PERFORMANCE INDICATOR

Delivery performance Order fulfillment Supply chain responsive time Total logistic redesigning cost

SUSTAINABILITY

PLANET PEOPLEPROFIT

Less TransportLess Pollution

More warehouses More employment

Delivery on timeHappy customers

OVERVIEW

Scenario 1 Scenario 2

Sustainability Less sustainable Sustainable

Service level Improve Improve

Total cost Higher Slightly higher

Thank you for listening