Case Study On Logestic Distribution And Cost Optimization Of A Company’s Products

Multi-species and low-volume production is becoming major manufacturing mode dueto cut-throat competition in the market. Followed by the complexity of whole logisticprocess from raw material purchasing, manufacturing, distribution and delivery isincreasing highly, logistic distribution also showing a lot of new features, How to reducecompany’s manufacturing, transportation and inventory cost under quick, on time deliveryrequirement is the new challenge of logistic distribution. This thesis is based on thelogistics network characteristics, to explore the network graph model and geneticalgorithm which used in logistics distribution optimization, in order to improve thescientific nature and decision-making efficiency of distribution decision.Firstly, thesis expounded basic theory, origin of network flow model and severalcommon network flow models, and basic theory of network solve method, like geneticalgorithm and so on. Currently product distribution network of relay manufacturing plantA company have a series of problem like raw material cost continuous increase, increasinguncertainty (temporary order) of customer demand, diversify of needs, long purchasinglead time of import components. Based on current distribution network, select3suppliers,Xiamen plant and3sales agencies of A company for example, mathematical modelingwith network flow theory. Consider3suppliers of A company stocked, use this model tocalculate total cost of Xiamen plant and3sales agencies in case of out of stock, whichincluding replenishment cost, inventory holding cost, stockout cost, and manufacturingcost. Objective of balance logistics and minimize total cost of distribution network, use theM programming language to program for simulation and optimization of related costparameters on Matlab platform, use genetic algorithms and random quasi gradientalgorithm optimization iterative solution for the model. On the basis of30generation ofsimulation, substituted to related cost of manufacture and made sensitivity analysis, get thepoint of that the influence of unit manufacturing cost, unit shortage cost and unit holdingcost to total costs is distinctly different under different production scale. At last, based on above conclusion, divided customer by different scale of product requirement, andprovided adaptive cost control proposals.Through this research, not only reduced distribution cost of A company, but alsoprovided theoretical basis to management for develop new product, determine theproduction line type and distribution method, and it’s also an active reference role for theoptimization of other products.