Saturday, January 7, 2017

Factors Affecting Distribution Network Design

By Christine Smith


Without proper supply tactics, many products would not have the chance to be seen in the market and consumers would not know about them. Manufacturers have to set up proper plans to ensure that their products reach users in a timely fashion. These plans are better known as Distribution Network Design and they include people, stores and transport facilities.

There are many products out there that people do not get to hear about because their manufacturers do not employ the best techniques to move the products around. There are different ways to move the products till they reach their desired targets and some of these strategies will be discussed below for further understanding.

When choosing a supply strategy, issues like the time which it takes the product from the production area to the market should be considered. As some goods may be perishable, strategies that ensure they reach the consumers in a timely manner should be deliberated. It is also necessary to involve retailers who know the product well and will have an easy time selling it.

Before selecting a design to implement, a business first has to market its product in all the areas it wants the product to reach. With products being almost similar, most companies use same techniques to market them and this makes competition fierce. A focused business will look for alternative methods of marketing which will give it an edge over its competitors and have its product gain more audience.

As the purpose of doing business is to satisfy customer needs and make profits at the same time, a firm should carefully examine how much will be spent on the process. After a particular method has been settled on, the firm has to set up the system and this may include training employees. As this might be expensive and time consuming, it is paramount to weigh the cost that will be incurred against the benefits before committing funds to it.

All companies want to spend the least amount of money when implementing a supply strategy, but this should not mean that the service and value are compromised. After a firm has selected a strategy to use, it should stick to the set guidelines of operation and under no circumstance should it deviate else it may find itself unable to operate normally.

It is vital to be aware of the rules and regulations set by relevant authorities that affect the distribution process. These authorities are responsible for setting taxation percentages and other rules for distribution services. These rules might be changed on a regular basis and if the heads of an organization are not updated, they might make mistakes which will put their organization on the wrong side of the law and this might incur them other charges, hence limiting profits.

It is advised that the lawmakers in a firm rank their options for distribution in order of preference. It is also wise to start off with one system and as more information is gathered, other systems may be pursued. Sometimes other designs may be found that correspond with the one being used and if they are merged, it is likely that faster growth will be seen.




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