What is a material-conducting chain?

In order for the final consumer to obtain the product he needs, the raw materials from which he is created pass through several stages of the production process, transport and intermediary stages. The material-conducting chain thus includes various interconnected links. During the movement, the cost of the flow is constantly increasing. As studies show, more than 70% of the cost of the product is the cost of operations to promote it. Let's consider what the material-conducting chain is, and also what are the approaches to cost optimization.

General information

What is a material-conducting chain? The photo presented in the article illustrates various options for delivering goods to the final consumer. As it was said above, at first the raw materials enter the production enterprise, where it turns into a product. After that, storage, packing, transportation, sale operations are carried out. The material-conducting chain is the path that the objects pass from the primary source of raw materials to the final consumer. It includes various links, involving specific operations with certain costs.

Material-conducting chain: description

In each specific area of the economy, a flow of resources is formed that moves from the source of raw materials to the consumer. Why do we need a material-conducting circuit? The answer to this question is obvious. It is necessary to provide society with the benefits that it needs. It is not difficult to understand what a material-conducting chain is. Difficulties can arise at the stage of cost optimization. After all, the main purpose of enterprises is profit extraction, and consumers - the acquisition of products at favorable prices. The cost of goods is formed primarily by the influence of production factors. The price of the product also includes the costs of storage, transportation, and sale. From how the material-conducting chain is used, the efficiency of flow control will depend.

Main directions

In the areas where the material-conducting chain is used, different approaches are developed to optimize the costs of moving objects. They allow:

1. Reduce the amount of stocks along the entire flow path.
2. Reduce transportation costs.
3. Reduce the duration of the goods through the chain.
4. Reduce manual labor and the cost of freight operations.

The value of inventory optimization

In the total amount of costs, the costs of their maintenance are more than 50%. Their structure, among other things, includes costs for maintaining the administrative apparatus, loss from theft, damage to products. A large volume of working capital of enterprises, as a rule, is involved in reserves. Its share can be from 10 to 50%. In the production cycle, the costs of maintaining reserves are in the range of 25-30% of all costs. Reduction of resources is provided due to achievement of high level of coordination of actions of participants of processes from which the material-conducting chain is formed. This is an increase in the reliability of supply, and the rational distribution of reserves.

Reduction of time

The material-conducting chain in logistics is formed by the direct participants of the processes. Currently, the average duration of product creation in the total life-cycle duration is 2-5%. Thus, operations for storage, packaging, transportation, sales take up most of the time. Reducing their duration helps to accelerate the turnover of capital and, accordingly, increase profits, as well as reduce the cost of products. To reduce transportation costs, delivery routes are optimized, graphics are coordinated, idle runs are reduced.

Integrative qualities

Speaking of what a material-conducting chain is, it is necessary to say that first of all it acts as an object of constant analysis. Investigating the way of movement of objects from the source of raw materials to the final consumer, specialists develop all new approaches to improve different indicators of the system. In the framework of this activity, the overall organization of the schemes is improved, the interrelationship of their individual components is increased, and controllability is improved. The complex economic effect of this usually exceeds the overall performance of the above-mentioned indicators. This causes the emergence of integrative properties. These qualities are possessed by the entire material-conductive chain as a whole, but not by its individual components. Integrative properties are expressed in the ability of the system to achieve the ultimate goal. At the same time, 6 rules are implemented:

1. The desired product is determined.
2. An indicator of the appropriate quality is established.
3. The required quantity is determined.
4. The period in which the product is to be delivered is set.
5. The delivery address is determined.
6. A scheme for minimizing costs is being developed.

The goal will be considered achieved when all these items are fulfilled.

What is the material-conducting circuit used for?

At present, marketing has acquired special significance in the sphere of economic activity. It acts as a specific management system, through which production adapts to market requirements. This, in turn, helps to ensure the most profitable sales of products. The object of marketing research is primarily a material-conducting chain. In the course of the analysis, specialists monitor and determine the emerging demand. In the process of research, information is collected and summarized about what kind of goods is needed in the market, what quality it should be, in what quantity, when, where it will be in demand.

The material-conducting chain in logistics ensures the promotion of the commodity mass to the buyer. Integration allows you to deliver products at the right time to the interested consumer and with minimal costs. Marketing articulates the task of implementing a systematic approach to the formation of commodity movements. With its effective implementation, each stage should be planned as an integral component of a logically constructed and balanced system. Meanwhile, it should be said that the methods of technical and technological integration of the participants of commodity circulation act as the main object of study of logistics, rather than marketing. The latter is focused on market analysis, psychological impact on the consumer, advertising and so on. Logistic activity is aimed at the formation of technically-technologically coupled models of the movement of objects along material-conductive chains. In the framework of this work, systems for controlling the movement of products are created.

Communication Marketing and Optimization

The system of adaptation of production to the actual market requirements became necessary in connection with the emerging difficulties in the sale of products. Marketing originated earlier than logistics. In the middle of the 20th century, the direction of production to create a demanded product and the use of methods for researching supply and demand became decisive factors for increasing competitiveness. At that time, the formation of end-to-end flow management systems was not particularly relevant. This was due primarily to the lack of technical capacity to implement such models. In addition, used at the time, marketing tools and so allowed to break away from the competition. Currently, these tools are extremely inadequate.

Demand, which is revealed in the framework of marketing research, should be timely satisfied with rapid and accurate delivery. It, in turn, is possible only if there is a well-established logistics system. Optimization of the process complements and develops marketing tools. Logistics allows you to connect the consumer, the supplier, transport in a planned economy, technically-technologically consistent and mobile chain. At the same time, the economic interests of all these subjects are satisfied with minimal expenses for the promotion of the goods.

Optimization example

The essence of the logistics approach in flow management is the integration of specific process participants into one system. The purpose of its functioning is the ability to deliver the goods to the addressee economically and quickly. The complexity of implementation lies in the fact that during the process it is necessary to unite the subjects with different economic interests. As a first example, a material-conducting chain will be considered, within which sugar is delivered from the producer to the retailer. In this scheme, three parties are involved:

1. Manufacturer.
2. Warehouse.
3. Network of shops.

Optimizing the flow helps to reduce the total cost of the product. This result is achieved by carrying out various activities. Optimization of packaging is one of them. Usually sugar is packed into bags during production. Their capacity, as a rule, is 50 kg. The unoptimized flow of this product, therefore, is the movement of bags from the manufacturer to the stores. A logistical approach presupposes close cooperation between all links of the chain. Suppose that the said three participants are one owner. Where can he arrange the packaging of sugar in packages? It can be done:

1. Behind the counter of the store in the process of customer service.
2. On the territory of the outlet, in the room for preparation of products for sale or at the workplace of an employee engaged exclusively in packing.
3. On a wholesale basis in a special workshop.
4. At the factory that produces the product.

Packing in the workplace of the seller or in a separate store space will be the least productive and most costly. A certain economic result can be obtained if the process is organized in a wholesale warehouse. However, in practice only in a limited number of bases it is possible to use the filling equipment at full capacity. The maximum effect is achieved when organizing the packaging process directly at the factory. Thus, if one subject is the owner of all participants in the chain, he would create a packing system at the manufacturer. In practice, the situation is usually different. All participants in the process are in the hands of various owners. In this case, if the store will benefit from the sale of pre-packaged sugar, the organization of packaging at the plant will require costs. To ensure that the product does not pass through the entire chain in bags, it is necessary to regulate the interaction scheme of the process participants.

The solution of the problem

When supplying bulk sugar to the retail network, all participants as a whole lose the opportunity to get additional profit. This can be avoided if the subjects, united, will solve the following tasks:

1. Determine the amount of additional profit that will arise when organizing the packaging work at the manufacturing enterprise. At the same time, they should agree on the procedure for the fair distribution of receipts.
2. They will choose technical means to ensure the process of delivery of the prepacked product to retail outlets. Among them, in particular, include: packaging equipment, which will be filled at the factory in packaged units, and then transported to stores through wholesale warehouses, special transport, through which efficient transportation, equipment for unloading / loading operations and etc.
3. Agree on an interconnected, unified process of processing the flow from the filling shop to the trading floor.
4. Solve different problems mathematically. For example, it can be the task of optimizing stocks at the stages of product movement, determining optimal batch quantities, and so on.

All these solutions form a complex of mathematical tools. With their use, it is possible to create an integrated material-conducting chain, which ensures profit only due to a qualitative change in flow control.

Optimization of delivery of reinforced concrete structures

Often, goods that are delivered on time are valued higher than those brought earlier or later than scheduled. As an example, consider the supply of reinforced concrete structures from the plant to construction sites. Concentration and processing of information about the needs of construction sites in specific products, data on the availability of a fleet of ready-to-work panelists, on the production capacities of factories takes place in the information center. Every day, it develops delivery schedules for designs. They indicate the supplier and recipient of each product, the number of vehicles to which the parts are delivered.

The development of charts is carried out with an accuracy of minutes. The panel is delivered from the manufacturing plant to the construction site by the time when the worker needs to install this particular part. Submission of the product to the floor is carried out "from the wheels" - directly from the panel holder. Due to such organization of delivery, the necessity of unloading and subsequent storage of reinforced concrete structures on the construction site is eliminated. Accordingly, the need for stocks is reduced, in a large area of the construction site. The building can be constructed among trees, and not on the site, caused by defective or inadequately brought constructions. Due to this optimization, the need to attract additional workers, financial resources and equipment is reduced.

Obligatory conditions

For effective functioning of the system of organization of delivery of reinforced concrete structures from the plant to the construction site it is necessary:

1. The presence of special transport and technical means at the manufacturer and at the facilities. They must be technologically coupled with each other and with the parameters of the products.
2. Clearly determine the sequence of actions, persons responsible for them, the technology of performing operations.
3. Solve the transport problem. It involves optimizing routes, scheduling delivery.
4. Mutually coordinate the economic interests of all participants in the chain.

As a result, the products will be delivered to the objects in the proper quantity, at the set time and with minimal costs.