Experts agree that most of the costs of the supply chain are locked in with the location of the facilities and the determination of optimal flows of product between them.
The most successful companies recognize this and place significant emphasis on strategic planning by determining the best facility locations and product flows.
Some firms have realized this and now run this type of analysis on a more frequent basis.
This allows them to readjust their supply chain over time and keep their supply chain continually running in an optimal state while preventing costs from drifting upward.
- Supply chain network design is the discipline used to determine the optimal location and size of facilities and their flow.
- Network modeling is the mathematical model of your supply chain.
- In FALKON NORTH AFRICA, we solve it using optimization techniques and then analyzed to pick the best solution.
- We focus on modeling the supply chain to determine the optimal location of facilities (warehouses, plants, lines within the plants, and suppliers) and the best flow of products through this facility network structure.
Companies which have a new supply chain through acquisitions can expect to reduce long-term transportation, warehousing, and other supply chain costs from 5% to 10%.