Supply chain modelling using world leading software
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We have developed a spreadsheet model to apportion costs to each delivery on a Paragon schedule. This information can then be used in customer account profitability studies and to produce cost tables. Cost apportionment has to be applied with great care in distribution, as removing a particular group of deliveries will affect the the cost of the remaining deliveries. Before any decisions are finalised, a new fleet requirement can be produced in Paragon.
The following settings are taken from a Paragon schedule:
● inter drop distances and speeds, possibly by postcode area
● stem distances and speeds
● vehicle capacities and unloading rates
The cost per vehicle day and mile is also a required input. The model then costs each delivery individually, assuming that each delivery on the vehicle has the same characteristics. It tests whether the vehicle will run out of physical capacity, driving time or shift time, then tests whether it is cheaper to serve the call with two trips in a shift rather than one. At the end of this process, it returns the cost of serving the call.
Paragon
Delivery Costing
Technology
To validate the apportionment process, the total cost of the individual calls is added together and compared to the cost of the fleet produced by the Paragon schedule and is factored, if necessary.
Cost curves can then be produced, such as:
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Supply chain modelling using world leading software
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