Once your product is built, packaged, put in a master carton, and is sitting on a pallet at the factory shipping dock, the product may still have a long road to ultimately get to the consumer. You have to design and manage your distribution plan. It has to get to an airport or (sea)port to your main carrier, out through the country of manufacturer’s customs, onto the transport, across the air or ocean, through customs at the destination country, off the transport, onto trucks to the distribution centers, to the store, and ultimately to the customer. It is not enough to design and build the product – teams need to plan for how the product will make this journey. Here are some typical questions teams need to ask as they plan their distribution system.
Final packaging for shipping
- What is the final packaging – individual, master carton, pallet, or container?
- Are different SKUs packaged together to save on space, or segregated to facilitate easy inventory management?
Transfer of the product from facility to shipping location
- Does the CM or the 3PL take the product from the factory to the main carrier?
- Are you producing in a SEZ?
- Who is handling the paperwork for transferring the product in and out of the SEZ?
Airfreight/container shipping
- What transportation mode is being used?
- Are you using small batch (LTL) or full containers?
- Who is booking space on the transport?
Customs
- Who is getting the product through customs?
- What paperwork is needed?
- How will the products be certified to get through customs?
- How are products coded for the right tariffs?
Transportation from the dock to distribution
- How is the transfer coordinated?
- What shipment method is used?
- Who is responsible?
Distribution warehouse tasks
- If products need to be repacked, tested, or assembled at the distribution site, who is doing it where?
- Where is the inventory held?
- How are the master cartons unloaded and products repackaged for the customer (individual or distributor)?
Order fulfillment
- Who is coordinating inventory and customer orders?
- What method to is used to ship to the customer? Air or ground?
Other
- Who manages the reverse logistics if product is returned, and what process is used?
- How are you insuring your product?