An optimized cost-based Outbound Logistics Network Design (OLND) for a car manufacturer.

Abstract

Abstract purpose: The purpose of this research is to map existing frameworks, models and literature on Distribution Networks (DN), Supply Chain Network Design (SCND) and Outbound Logistics Network Design (OLND) relevant to the automotive industry. Based on a selection of applicable models, a suggested cost optimized OLND for the automotive industry, including two types of goods, will be presented. Design/methodology/approach: Critical examination of literature on Distribution Networks (DN), Supply Chain Network Design (SCND) and Outbound Logistics Network Design (OLND) related to the automotive industry will be conducted in order to understand how optimization problems are currently addressed in their context. Several models and approaches will be investigated and analyzed. The findings of the academic literature and the empirical findings from the supporting company will be combined to construct a model, tested at Lynk&Co, relevant for the automotive industry. Expected findings: A critical evaluation of current theories tackling Distribution Networks (DN), Supply Chain Network Design (SCND) and Outbound Logistics Network Design (OLND) will show that there is still limited research conducted on new mobility trends and their effects on practices in supply chains and logistics flows of car manufacturers. Current research and their results are not in a form that is actionable for practitioners embracing the shift in customer preferences in the automotive industry. The forward-looking research will provide understanding of the current research and propose a modified solution as well as identify gaps for further research and better practice for a more mature supply chain for car manufacturers in the future. Research implications: The paper will provide an extensive literature review to identify key elements used in current DN, SCND & OLND and present a model usable to develop an optimized cost-based optimization for an outbound logistics network for an automotive Original Equipment Manufacturer (OEM) Practical implications: The extensive research on current practice in Supply Chain Network design and Outbound Logistics Network design aims to support, assist and challenge current practice in the automotive industry and at the supporting company, Lynk&Co.