Yulin Tobacco Companies Logistics Cost Optimization

With the aggravation of the market competition, the corporates have a more profound understanding of the cost of logistics as "the third profit sources", so the optimization of logistics has become a question of important research field. China is the world's largest tobacco producing and consuming nations, and the tobacco industy occupies an important position of the national economy. In accordance with enterprise features, to optimize the costs of logistics distribution is one of the important means for the tobacco companies to reduce cost and improve core competitiveness and continue to maintain sustained, steady and healthy development. So it has theoretical and practical significance to explore the issue of optimizing the logistics cost distribution for tobacco companies.From the perspective of cost management, this study based on many domestic and foreign literatures, and analyses the factors which influenced the logistics cost, as well as the principles and ways of the optimization of logistics distribution cost. On this basis, this study focus on the method of distribution cost optimizing for Yulin tobacco commercial enterprise. Through analysis, comparison and summary, this paper optimized the distribution costs from three main aspects: based on C-W Savings Algorithm for vehicle routing problem; with the probability estimation method for the management of vehicle fuel consumption; based on the safety stock for inventory optimizing, and carried out empirical research on the Yulin tobacco company.Through this empirical research, we can draw the following conclusions: based on the goal of cost minimization and bound by certain conditions, the author established a optimizing model for vehicle routing problem, and provided improved Savings Algorithm to solve the problem. When the objects of distribution at a smaller case, this approach will has more precise conclusion and the calculation is more concise. Probability assessment method used for fuel management, is a flexible and strong interoperability approach. It is an effective way for tobacco commercial erterprise to optimize inventory based on the safety stock.The article's research conclusions present the reference values for the Yulin tobacco company to manage the cost of logistics and improve corporate competitiveness.