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1、Auto Logistics and Supply Chain Management Summit 2003The Practice of VMI in China陈 晖中国物流公司 执行总裁1AgendanOur understanding of the automotive logistics needsnWhat is VMI definition, procedures and benefitsnChallenges of VMI in ChinanCase studynBrief introduction to China Logistics Company2An automotiv
2、e OEMs logistics needs cover both inbound and outbound operations of parts and finished vehiclesPlantSuppliersConsolidation and Loading CenterService Parts Distribution CenterLogistics for Production PartsLogistics for Service PartsLogistics for Complete VehiclesDealerDealer/ Service StationBonded W
3、arehouse for Import PartsOur understanding of the automotive logistics needs3Supply chain management (SCM) is the strategic management tool that coordinates the material and information flows across the value chain to support adaptiveness4“Demand-pull” value chain requires the companies to be flexib
4、le and able to “control” a large part or the entire supply chainSuppliersManufacturingDemand indirectly drives manufacturing volume through forecastsWarehouseWholesale/Retail“Supply-push” Logistics ChainSuppliersB2B ExchangeManufacturingDirect Delivery“Demand-pull” Logistics ChainManufacturing drive
5、n by actual demand The rate of supply was set by the manufacturer in advance, based on expected demand It was the role of the logistics providers to ensure a just-in-time supply of components The rate of manufacture is determined on a real-time basis by the rate of demand While this model is more ef
6、ficient, it requires perfect integration of all logistics operations within one processSource: Lehman Brothers, A.T. Kearney Analysis5Third-party logistics providers (3PLs) can directly, or through a partner network, provide a range of services Procurement Payables management Supplier payment and co
7、nsolidated invoicing Vendor performance monitoring and exception reporting Joint process improvement with vendors Overall freight coordination Full load truck carrying Less-than-load truck carrying Small lot (less than 150 pounds) carrying Order consolidation Delivery scheduling Expediting special /
8、 rush orders Returning and reprocessing undeliverable orders Delivery tracing Performance and exception monitoring and reporting Overall inventory management Optimizing supplier order schedules Optimizing dealer order schedules Certification of incoming shipments Bar coding Performance and exception
9、 monitoring and reporting Tracking and Reporting Systems accessible via Internet Material Resource Planning Order preparation / assembly / consolidation Sourcing of packaging materials Printing of corrugate and/or linerboard materials Labeling Shrink wrapping of cases and palletsFreight and Distribu
10、tion CoordinationWarehousing and Inventory ManagementMinor Assembly and PackagingProcurement6Difference between traditional business model and VMI modelTraditionalVMI Purchase Order PlacementWhen a customer needs product, they place an order against a manufacturer. Under VMI, the vendor generates th
11、e order, not the customer.Inventory Transpare ncyOnly order is transmitted to supplier when product is needed.The vendor can view the “real-time” stock level of every item that the customer carries as well as true point of consumption data. Inventory Replenish mentThe customer is in total control of
12、 the timing and size of the order being placed.The vendor is in total control of the timing and size of the order being placed.Inventory PlanThe customer maintains the inventory plan.The vendor is responsible for creating and maintaining the inventory plan.7Simplest VMI workflowManufacturerSuppliers
13、23411.The manufacturer approves the purchasing terms with suppliers, including the commonly agreed inventory responsibility and maintenance scheme.2.The manufacturer sends product activity data to the supplier. This product activity is based on warehouse movement of product consumed at the assembly
14、line level.3.Based on the agreed inventory maintenance scheme, the supplier edits, approves and releases the suggested purchase order.4.The manufacturer approves this purchase order and send it to the supplier. 8Consolidation and Loading Center is commonly used to reduce the complexity in coordinati
15、ng multiple vendorsnQuality of delivery services from vendors to line-side might be different nVendors shipping volume might be very small given more frequent “demand-pull” ordersnVendors might need a large line-side buffer to comprise a full-truck load and make-up a safety stocknLarge line-side are
16、a is needed to accomplish unpacking, kitting, and possibly sequencing of parts before feeding to assembly linenIndividual vendors might rent warehouses for themselves, with limited scale to share with other vendors nConsistent delivery service to line- sidenOptimal shipping volume to reduce transportation cost and inventory costnReduced requirement on l
