The Channel on the right shows how the Map stocks move from the print planning to the Printing lines, the printed maps move to the Bulk store. Broken down orders are then taken to the Picking area. The channel on the left displays how the customers' orders and trade orders meet up with the Moulin inventory control system. The system is in constant communication with the right hand side channel making sure there is enough stock in place. Through a bar coding system, using hand held scanners, Moulin automatically finds the requested orders in the Bulk store, a picker then brings it down to the picking line. The goods are then packed and dispatched using a contracted logistics service provider.
The movement of goods within CSF have both a manual and an automated system working together to produce maximum output. The printing department has the most activity, as much as 4 hours can be spent on setting up just one machine with the majority of time spent on configuring the plates and adjusting the colours. Once set up, the printing machines work two seven-hour shifts, each producing as much as 8000 maps per hour. The company has four printers with two different printing machines, Alpha and Beta. The Alpha machines are older and less efficient, with almost twice as much time needed for set up whilst, only producing half as much output compared with the Beta machine. (Johnston et al, 2003:170).
CSF has two fairly distinctive levels of demand. The first is a lower level, where monthly sales volume accounts for only 5% and 7% of the annual total and a second, higher level of demand shows monthly sales of 9% and 11% of the annual total. The planning procedures department use as much as 12 months lead time in preparation for new maps and stock replenishment. The team determine the need for placing a map (stock) on the printing schedule as much as 6 months in advance. They aim to deliver a batch of printed maps to the Bulk store 3 months before stock is projected to run out.
Holding 12 months of inventory can be expensive. Warehousing for storage including rent and utilities, Insurance and taxes on inventory finance for the stock, and stock lossage due to shrinkage/deterioration are just a few costs for holding inventory over a long period. Inventory optimization www.sap.com Accessed 2.1.2007
Moving over to the left channel of figure 1 we see more activity coming in from customers and trade orders. CSF aim to have dispatched the customers order within three to four days of receipt, with an 88% performance target regularly being exceeded. Only over the busy Easter months have CSF had problems with delivery times, this was mainly due to their contract logistics service provider. CSF should have forecasted from previous years that Easter was the busiest time and so they should have hired more transport through their logistics providers.
The company uses an Electronic Data Interchange (EDI) for their customers to place orders. Only 50%-60% of the orders are EDI with the remaining orders being keyed in to Moulin by hand. This process is slow, not cost effective and can generate errors. Use of this channel is limited to a small amount of CSF's largest customers. Here I think is CSF's biggest downfall. According to Stock, If the