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How to Optimize Transport (Full Trucks) using SNP Optimizer

Former Member
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SCM-APO Experts,

We are implementing the SNP Optimizer to optimize Sourcing Decisions (Supply) and generate Purchase Requisitions in a Distribution Network of Plant to Regional Mother Distrubution Center (DC) to couple of Levels of Local DCs.

From the perspective of Level-3 Local DC, which normally gets replenished with Stock from a Regional DC which is fed by multiple manufacturing Plants where different products are made. Some Mfg. Plants make the same FGs so the Regional DC can get replenished from Multiple Plants obviously due to Production Capacity limitations of each Plant. The SNP Optimizer would do Cost based DISCRETE Optimization to minimize Cost of Production (different plants), Transport ( different lanes) and Storage (different DCs) against Penalties for Non-delivery, Delay and Safety Stock Violation to find the Least cost of Distribution and Manufacturing taking Production Capacities into account.

The Question I have is with regards to TRANSPORT.

Often in some weeks (say 2 months ahead) the Quantities of Products required are big enough that actually instead of Shipping from Plant -> Regional DC -> Local DC it makes sense cost-wise to DIRECT-Ship from Plant to Local DC to incur the least Freight Cost.

How can this be done in the SNP Optimizer ? How can SNP Optimizer take Full Transport Capacity as well as Cost into account to make Direct-Ship recos ?

I've created Transport Lanes from Plant->Regional DC->Local DC as well as DirectShip Lanes from Plant->Local DC with a different cost of Transportation. I've tried to create a Transport Resource and attach to both the Lanes, but not getting succesfull results. The issue is SNP Optimizer is always choosing the lane with the least cost and does not look at FULL Truck Loads Transport Capacity 2 months ahead to plant direct-ships from from the Plant to the Local DC instead of routing it via Regional DC.

I may be doing something wrong. I need help to understand if this can be done in SCM-APO. I use SCM 5.0 internally and my Customer is on SCM 4.0.

Please provide help from your experience.

Regards,

Ambrish Mathur

Accepted Solutions (1)

Accepted Solutions (1)

Former Member
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Hi

Have you tried to use a "Cost Function" on the Means of Transport in the TL? This allows you to have variable costs depending on the quantity of product being shipped. So in your case the larger the quantity ordered, then you can make the cost of direct shipments cheaper.

Use /SAPAPO/SNPCOSF to create the Cost Functions with type of "T" for Transportation. You can then assign these in the Means of Transport.

Hope this helps

Regards

Ian

Answers (7)

Answers (7)

kenneth_snyder
Active Contributor
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You are trying to use a tool for something it was not designed to do...

SNP Optimizer is not a transportation planning tool.

You have to be creative to make it work similar to what you need, but it will not do exactly what you want.

That is why there is TMS and TPVS...

Ken Snyder

Former Member
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Any Help from any expert on SNP Optimization of Transport ?

Former Member
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Forgot to mention ...

The Transport Cost Function can be only based on UOM - Distance - (i.e : Km, Mile ...etc. ) and cannot be modelled based on weight limits of the Truck as APO does not allow any other UOM except that of Distance.

So I do not think Cost Function in Transport can meet the needs.

Any other suggestions for this very much reallife scenario in Distribution Planning ?

Regards,

Ambrish Mathur

Former Member
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In /sapapo/snpcosf ... while for Transport the Function is not Product Dependant and I could find a Minimum and Maximum Possibility of CASES (Base UOM) to be provided ... I did not see a facility of a WEIGHT (Max. weight of Truck provision).

Actually all Products are never similar in terms of weight, volume on the lane in real life ... so the need is to capture for Different Truck Load Weights by adding up the Weight of each Product for which supply PR has been created (Weight of Product = Quantity of PR in Cases x Gross Weight / Case factor from Product Master).

Also I guess for different Weight Ranges (eg : 50% of Truck Load, 80%, 100% of Truckload I can put in Costs ... but I need to put Costs by Weight & not CASES as the Help on /sapapo/snpcosf says.

This is my problem also. Any ideas on how to tackle this very much real life Direct-Ship Business Scenario in SNP based Optimization ?

Regards,

Ambrish Mathur

Former Member
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Cost function can be used to mimic this functionality but it is not the real use.

And it will only work assuming each product has similar weight, volume, etc...

Ken Snyder

Former Member
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I think that the transport cost function do what you want (is not product dependent)

Former Member
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The Lane will have Multiple Products (100+) and so the Cost Function is a Multiple of Weights of many Products (say 10 for our example) that on a particular week the Demand for all 10 Products is large enough to justify a full truck load for all Products Combined on the Truck and hence possible to direct-ship from Plant to Local DC.

Can a Cost Function Add up Quantities of Multiple Products on a Lane to find if it is a Full Truck Load (the cost of which combined will be lesser than the cost of separate products on a full load).

Will the Cost Function allow to look at the Transport Capacity ?

Please clarify with an example if you can.

Regards,

Ambrish