A logistics system design for fast moving consumer goods

Abstract

This research addresses to a logistics system design for fast moving consumer goods. Within the context of the thesis, the distribution system of cold products starting from the ordering process and ending with the placement of the product on the chain store shelf considering storage, preparation, loading and delivery operations for T. Group in Istanbul was studied. The purpose was focusing on ways to improve the current program with a systematic approach and industrial engineering tools. The primary performance indicators are distribution time and costs, stock- out occurrences, and the ratio of fresh products on the shelves. Thus, the ultimate goal is to increase retailer and consumer satisfaction. After problem characterization and suggestions to improve the current system operations, two major problems, “Storage System Design” and “Vehicle Routing Problem” were discussed. A new layout design that depends on the compromise of dedicated storage policy with full turnover storage policy and a new in-truck layout and loading procedure is offered in order to maximize the utilized volume of the trucks. For vehicle routing problem, savings algorithm with Yellow’s (1970) modification was assigned. After the design of the distribution system, a decision support system was offered in order to respond for future changes related to the current system. Lastly, the designed program was run for different scenarios and their results were analyzed. In light of these runs, it has been proved that an excessive amount of improvement is possible in the current system.