Consolidation center location

A consolidation center is a facility, located near a manufacturing plant, that receives components and parts from many suppliers and delivers them to the plant. Practitioners of lean production use these centers to insulate the factory from overseas suppliers with long lead-times and from... 

The consolidation center is not used for every item. Indeed, suppliers deliver directly all the items other than those explicitly identifed for the consolidation center. Returnable containers with item-specific dunnage are used for local deliveries on milk runs because (1) they save assembler time and disposal costs, (2) their number caps the amount of parts in circulation, and (3) the trucks that ride back to the supplier plant would otherwise be empty. The economics of returnable containers become less favorable for distant suppliers, whose remote or overseas locations may provide opportunities for return freight. 

First, we define what a consolidation center is and examine the reasons for practitioners of lean production to resort to this structure rather than deal directly with their suppliers. Then we describe the work that can be profitably off-loaded to the consolidation center, the physical organization of how this work is or should be done, and where the consolidation center should be located. We also describe the type of work that is best not entrusted to the consolidation center but kept in the manufacturing operation. 

From a strict logistics point of view, the best location for the consolidation center would be inside the plant building. Transportation from the consolidation center to the line side could then rely on the same marshaling trains or carts used for other items, and the weather would not matter. 

Consolidation centers are often located in a separate building within the same industrial park as the plant. If the climate permits, it is still possible to load vehicles that go directly to the line side at the consolidation center. Otherwise, an additional transfer is needed when the parts reach the plant. The consolidation center staff still comes from the same labor pool as the plant staff, but corporate identities are more clearly separated and daily contacts are few. 

This is the information required to drive operations on a daily basis. The flow of kanbans from the plant tells the consolidation center what should be picked and delivered. On the other side of the flowracks, the palletunloading fixtures should be sequenced by item, and the corresponding trailers should be brought to the docks. Outside in the yard, incoming truck drivers should drop off their full trailers at an assigned location, get appropriate credit for them, and know which empty trailer to take away. If the empty trailers contain skids or blow-molded separators, they are also item specific. The drivers also should be directed to the return freight, unrelated to the plant, that they may carry on the way back. 

Consolidation can occur in three different ways by location, by time periods, and by products. Consolidation by location has resulted in companies setting up regional distribution centers, and serving multiple cities from the same distribution center. Staples has used a centralized distribution network (Gourley 1997). Disney Stores uses a dedicated Central DC (CDC) in Memphis to supply more than 100,000 types of products to 360 stores (Jedd 1996). Benetton uses one CDC in Ponzano, Italy, to serve over 6,000 stores in 83 countries (Dapiran 1992). 

Monomers with low molecular weights will diffuse into the wood more rapidly than polymers such as PEG. In a second phase, their in situ radiation curing will form wood consolidants that are much stronger than PEG. However, this method requires very heavy irradiation equipment, which is usually available only in nuclear research centers. The irradiation cell dimensions and the 7-source geometry limit the size of the artifacts. For mainly these reasons, the radiation process was applied in very few institutions and in most cases only at the experimental level. The Nucleart Laboratory, which routinely conserves waterlogged wood by this technique, is located in the Grenoble Nuclear Research Center of the French Atomic Energy Commission. 

Once the consolidated relationship chart for the work centers has been completed, the designer can develop relationship charts for the equipment within the individual centers. As before, the first step is to determine all equipment that is to be located in the particular work center. The equipment is then listed on the relationship chart just as the work centers were listed on their relationship chart (Kazarian 1989). 

Figure 2 Relationship Chart for Consolidated Ratings for Work Centers within the Facility. (The ratings are anchored at 4, very important to be located close together, and 0, not important to be...

This chapter describes the efforts of a major distribution and retail company to lower its cost and modernize its systems. It also details the use of distribution network modeling in locating a consolidated distribution center. The modeling application sought to develop the lowest-cost alternative distribution center for Smart Final. The chapter also outlines the barriers arising from opposition to change within the organization. 

Intermediate treatment factories belonging to echelons located at the center part of Fig. 2 are used as subjects, as locations of intermediate treatment factories including their elimination and consolidation, for shifting to other intermediate treatment factories in the same echelon, for new establishment of a transshipment and storage complex, and for introduction of a modal shift between a transshipment and storage complex and an intermediate treatment factory. 

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