IIM Event – Case study

Network Design
The Case As/Is Distribution

A Manufacturing organisation deals in 3

different product categories Electronics,
Furniture and Home & Kitchen Products.

Their business and customers are spread

pan India. They have 3 factories, 4 RDC’s
and 15 Warehouses to cater to the
demands across India.

Each plant is restricted for production of

one product category (Electronics,
Furniture and Home & Kitchen Products.)

Case Study - Data

** Attachment is sent along with the presentation
** Attachment is sent along with the presentation
Case Study
As/Is Distribution:-
In the current scenario, the network flow of the manufacturing organisation looks like this:-
The RDC’s receive the finished goods from the Factories, from there they are further distributed to different Warehouses
and finally to the end customers.

Requirement Major Questions? Constraint

• Do we need all the RDC;s and
Which RDC or warehouses do we
warehouses, or just need to • Factories are restricted to
need to choose out of the list in
realign the distribution? produce one product.
order to have an optimal
replenishment setup with minimal
• In order to change the network
transportation and warehousing
what should be the most
costs and hence, reducing the total
optimum location for the RDC’s
logistics cost
and the Warehouses?
 Cost Details
Warehouse & RDC cost – Refer the
excel sheet

Transportation cost –
For FTL – Refer the excel sheet

For LTL - This cost is directly

proportional to the fill rate (chart
given in the presentation for
reference). For example, for 50% of
FTL fill rate i.e. 5 Tons, the cost is
75% of FTL cost i.e. INR 37.5/km

*Rest of the LTL cost can be calculated

from the graph as well
Thank you
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