Coordination of Inbound Logistics Flows: A Case Study of Terms of Delivery for the Supply of Components from External Suppliers to SKF Factories

Abstract

Changes as the increasing globalization, changes in customer expectations and preferences, consistent technology advances in manufacturing and communications areas, as well as the increasing demand for social and especially environmental responsibility, forces the companies to revise their processes in order to stay competitive in the marketplace. Revising the inbound logistics flows is not an exception. The purpose of this study is to determine the most advantageous Term Of Delivery for SKF factories by mapping and evaluating the current inbound flows of components from suppliers to SKF factories in Europe. Furthermore, the purpose is to evaluate the improvement potential of using the most favorable Terms Of Delivery by identifying flows that have such possibilities of improvement. In addition, other possible improvements related tothe inbound logistics will also be analyzed and presented. The result of this research is that SKF should revise the use of certain delivery terms that are applied today and choose the delivery term that provides the company with the most responsibility and cost undertaking when it comes to inbound transportation. Thereby, SKF obtains the greatest possible control of the goods flows into and from the company. By having control of the goods flow, a company can make warehousing, production and transports more efficient, create routines and thereby cut costs. Three different suggestion alternatives are presented as possible improvements related to a coordination of mapped inbound flows.